"atson, ;.&., 1he &conomic oncept of a Public 'tility,  &conomica, /o. ?

5 (/ovember
R EVIEWER:
EVIEWER: TRANSPORTATION AND
RANSPORTATION AND PUBLIC UTILITY  L
 L AW 300), pp ?4-6?-5.
 oncepts of a public utility
o +egal oncept
(Roe Anuncio)  !upported by the economic concept
PART ONE: PUBLIC UTILITIES  nce the politicians regulate, they pass laws
I. Gen
General
eral Di
Discus
scu ssi
sion
on o Political oncept
 A. Wa! is a "u#lic u!ili!$%
 !upported by the economic concept
 Politicians should regulate
Class no!es:
o &conomic oncept
Public utility 
 1his is narrower and more fundamental
 business or service engaged in regularly supplying the public with some
 2actors that allow public utilities to price differentiation
commodity or service of "u#lic conse&uence .
. &con
&conom
omie
iess of
of sca
scale
le
 may either be "u#lic use or "u#lic ser'ice.
5. ;igh
;igh fixe
fixed
d cos
costs
ts
 examples: electricity, gas, transportation, water, telephone.

n the exercise of its police power, the !tate regulates public utility to protect the Cases:
interest of the public power.
A!& 11+& 2A1! ;&+B$RA1 B1R/& +A!!
"asic principle:  Private
 Private property devoted to public use ceases to be #us privati and /1&!
must submit to !tate control$regulation.
control$regulation. *unn '. 1he eneral "eing a hen private property
Illinois  Assembly of the public utility, is affected with public
 A((i!ional Rea(in)s: !tate of llinois a public interest, it ceases to
%illar, &dythe !., s the P ublic 'tility oncept bsolete*, +and &conomics, ol. -, passed an act warehouse be #us privati only.
/o. 0, !ocial ontrol of Private Power: 1he Past and 2uture of Public which regulated may be Property becomes
'tility Regulation (August 334), pp. 5-06574 public regulated by clothed with public
 Public utilities are not obsolete and should not be regulated. 1hese goods warehouses, the !tate in interest when used in
are inelastic. which included the exercise a manner to ma9e it
the fixing of of the of public conseCuence
o ross6subsidi8ation maximum latterDs and affect the
o %oderni8ation charges for the police community at large.
o onsolidation and oncentration storage of grains. power. !uch
 1his trend of consolidation that consumes the Petitioners regulation
telecommunications
telecommunications industry in the '.!. is similar to the Cuestion the may be in
concept of a natural monopoly. 'ltimately the number of statute for the form of
players will reduce therefore ma9ing it a natural encroaching upon rate fixing.
monopoly. their right to
ray, ;orace %., 1he Passing of the Public 'tility oncept , 1he <ournal of +and = private property.
Public 'tility &conomics, ol. >, /o.  (2ebruary 3?@), pp 7 65@ Lu+on Petitioners are Petitioners  A business may be
 Public utilities are obsolete and futile. 1here should be more government S!e'e(orin) corporations are engaged affected with public
involvement by providing for positive reinforcements such as protecting the '. PSC engaged in in public interest and regulated
environment, etc. !o far, government has been giving negative regulations. stevedoring or service, and for public good
hat ray wants is positive regulation. t will still be laisse8 fare but there lighterage and are thus although not under
are certain things you must avoid and be responsible. ray also suggests harbor towage considered any duty to serve the
new institutions or alternatives wherein the overnment will provide
provide goods business, as well public public. A public utility
and services. 1he government will be involved by providing the public utility as in interisland utilities. is not determined by
and finance public utilities. +astly, ray suggests centrali8ed economic service. 1hey the number of people
planning. have no fixed it actually serves, nor
routes, a limited does the mere fact
clientele, and a that service is
, of ,- 
 range of rates for rendered only under Class no!es:
their services. contract prevent a
company from being a 1he power to regulate public utility ultimately resides in ongress by virtue of its
public utility. police power, but may be held by agencies empowered by law.

hy would ongress want to delegate such a power* Agencies have the technical
9now6how and s9ills to handle their tas9sE it would be very impractical for ongress
B. Wa! is a "u#lic ser'ice%
to handle everything.
Rele'an! Pro'ision:
Public !ervice Act (A ?>), !ection 0 (b)  A!& 2A1! ;&+B$RA1 B1R/& +A!!
 in essence, provides for the ele/en!s o0 "u#lic ser'ice , to wit:
11+& /1&!
. any person
person who maymay own,
own, operate,
operate, manage
manage,, control
control  Al#ano 1he %1  A legislative franchise is not
not 1he power to
5. for hire
hire or
or com
compen
pensat
sation
ion '. pro#ect was needed because the power regulate public
0. with
with genera
generall or limite
limited
d client
clientele
ele Re$es awarded to to enter into contracts with utilities
?. permanent
permanent,, occasi
occasional,
onal, or accidental
accidental 1! by the respect to the belongs to
4. for genera
generall busine
businessss purp
purpose
osess PPA after the management, operation, ongress.
bidding. and development of the ;owever, a
1Di00eren!ia!e "u#lic u!ili!$ 0ro/ "u#lic ser'ice Petitioners %1 has been delegated valid
contend that a to the PPA by virtue of PB delegation of
 All public services are
are public utilities but
but not all public utilities
utilities are public legislative 4>-. %oreover, %1 has such power
services. franchise is been privati8ed. Assuming may be made
"ut really, there is no difference. reCuired, %1 arguendo it has not been to
being a public privati8ed, the decision still administrative
C. Le)al Basis an( Ra!ionale 0or Re)ula!ion utility. stands because of the valid agencies.
delegation of power (from
Class no!es: ongress to the
Regulation is done to protect public interest. administrative body PPA).
3*U '. +12R" granted 1his is an undue delegation 1he
A!& 11+& 2A1! ;&+B$RA1 B1R/& +A!! Garcia the provincial of legislative power. 1he +egislature
/1&! bus operators to ongress delegated its has not
Re"u#lic %eralco filed 1he !tate may, n regulating rates set the fare authority to regulate public authori8ed the
'. *eralco with the in the exercise charged by public rates, the utilities to the P! under Public !ervice
&nergy of its police utilities, the !tate former the Public !ervice Act. 1he ommission to
Regulation power, regulate protects the public providing only a +12R" was also granted delegate that
"oard (&R") %eralcoDs rates, against arbitrary and range within the said authority via & power to a
an application the latter being excessive rates while which the rates 5@5. "ut the two common
for the revision a public utility. maintaining the should fall. mentioned admin bodies carrier or
of its rate efficiency and Cuality cannot delegate that power other public
schedules. of services rendered. to a common carrier, a service.
1he rates must be one transport operator, or other
that yields a fair return public service. 1his would
on the public utility leave the riding public at
and also one that is the mercy of transport
reasonable to the operators who may
public for the services arbitrarily increase fares.
rendered. Ba!an) !angguniang 1he +' may have power 1he power to
as Panlungsod (!P) over the operation of the regulate the
CATV '. issued a A1 but such does not fixing of rates
D. Were (oes !e Po2er !o Re)ula!e Pu#lic U!ili!ies Resi(e% CA Resolution cover the regulation of rate by
granting fixing which falls under the telecommunic
4  of
 of ,- 
 range of rates for rendered only under Class no!es:
their services. contract prevent a
company from being a 1he power to regulate public utility ultimately resides in ongress by virtue of its
public utility. police power, but may be held by agencies empowered by law.

hy would ongress want to delegate such a power* Agencies have the technical
9now6how and s9ills to handle their tas9sE it would be very impractical for ongress
B. Wa! is a "u#lic ser'ice%
to handle everything.
Rele'an! Pro'ision:
Public !ervice Act (A ?>), !ection 0 (b)  A!& 2A1! ;&+B$RA1 B1R/& +A!!
 in essence, provides for the ele/en!s o0 "u#lic ser'ice , to wit:
11+& /1&!
. any person
person who maymay own,
own, operate,
operate, manage
manage,, control
control  Al#ano 1he %1  A legislative franchise is not
not 1he power to
5. for hire
hire or
or com
compen
pensat
sation
ion '. pro#ect was needed because the power regulate public
0. with
with genera
generall or limite
limited
d client
clientele
ele Re$es awarded to to enter into contracts with utilities
?. permanent
permanent,, occasi
occasional,
onal, or accidental
accidental 1! by the respect to the belongs to
4. for genera
generall busine
businessss purp
purpose
osess PPA after the management, operation, ongress.
bidding. and development of the ;owever, a
1Di00eren!ia!e "u#lic u!ili!$ 0ro/ "u#lic ser'ice Petitioners %1 has been delegated valid
contend that a to the PPA by virtue of PB delegation of
 All public services are
are public utilities but
but not all public utilities
utilities are public legislative 4>-. %oreover, %1 has such power
services. franchise is been privati8ed. Assuming may be made
"ut really, there is no difference. reCuired, %1 arguendo it has not been to
being a public privati8ed, the decision still administrative
C. Le)al Basis an( Ra!ionale 0or Re)ula!ion utility. stands because of the valid agencies.
delegation of power (from
Class no!es: ongress to the
Regulation is done to protect public interest. administrative body PPA).
3*U '. +12R" granted 1his is an undue delegation 1he
A!& 11+& 2A1! ;&+B$RA1 B1R/& +A!! Garcia the provincial of legislative power. 1he +egislature
/1&! bus operators to ongress delegated its has not
Re"u#lic %eralco filed 1he !tate may, n regulating rates set the fare authority to regulate public authori8ed the
'. *eralco with the in the exercise charged by public rates, the utilities to the P! under Public !ervice
&nergy of its police utilities, the !tate former the Public !ervice Act. 1he ommission to
Regulation power, regulate protects the public providing only a +12R" was also granted delegate that
"oard (&R") %eralcoDs rates, against arbitrary and range within the said authority via & power to a
an application the latter being excessive rates while which the rates 5@5. "ut the two common
for the revision a public utility. maintaining the should fall. mentioned admin bodies carrier or
of its rate efficiency and Cuality cannot delegate that power other public
schedules. of services rendered. to a common carrier, a service.
1he rates must be one transport operator, or other
that yields a fair return public service. 1his would
on the public utility leave the riding public at
and also one that is the mercy of transport
reasonable to the operators who may
public for the services arbitrarily increase fares.
rendered. Ba!an) !angguniang 1he +' may have power 1he power to
as Panlungsod (!P) over the operation of the regulate the
CATV '. issued a A1 but such does not fixing of rates
D. Were (oes !e Po2er !o Re)ula!e Pu#lic U!ili!ies Resi(e% CA Resolution cover the regulation of rate by
granting fixing which falls under the telecommunic
4  of
 of ,- 
 "atangas A1  #urisdiction of the /1./1. 1he ation 0. "oard
"oard of
of Power
Power and
and ate
aterwo
rwor9
r9ss
to permit to +' may regulate A1 companies  1he "oard of 1ranspo was merged with the "ureau of +and 1ranspo,
construct, install operations with regard to rests in the forming the +and 1ranspo ommission which was later on abolished by
and operate the physical realities of /1. virtue of & 54.
A1 system in constructing the A1  1he +12R" was then created via & 5@5.
"atangas ity, system: use of public
authori8ing the streets, rights of ways, E. No! a Pu#lic U!ili!$
latter to set its founding of structures, A!& 2A1! ;&+B$RA1 B1R/& +A!!
own rates for its parceling of large regions, 11+& /1&!
subscribers, but etc. Ne##ia 1he /G 1he !tate may  Although not a
any increase '. Ne2 +egislature regulate the prices public utility, a
shall be sub#ect  Yor9  created the %il9 imposed by business may be
to the approval ontrol "oard with /ebbiaDs grocery regulated (through
of !P. the power to fix store. 1he business rate6fixing) as long
minimum and is of a public as the law is not
maximum retail conseCuenceE arbitrary and has
Rele'an! "ro'ision: prices to be however, it is not a reasonable relation
charged by stores public utility to the purpose.
Public !ervice Act (A ?>), !ection 0(a): to consumers. because there is no
 Te Co//ission 5PSC6 sall a'e 7uris(ic!ion8
a'e  7uris(ic!ion8 su"er'ision8 an( /ebbia, a grocery element of
con!rol o'er all "u#lic ser'ices an( !eir 0rancises8 e&ui"/en!8 an( store owner, was devoting private
o!er "ro"er!ies, and in the exercise of its authority, it shall have the charged with property to public
necessary powers and the aid of the public force: Pro'i(e(, 1hat public violating the use.
services owned or operated by government entities or government6owned or "oardDs order.
controlled corporations shall be regulated by the ommission in the same Ta!a( B1 and &B!A hat &B!A +R1 1he onstitution
way as privately6owned public services, but certificates of public '. +R1 onsortium onsortium owns reCuires a franchise
convenience or certificates of public convenience and necessity shall not be Garcia entered into a are the rail trac9s, for the o"era!ion
reCuired of such entities or corporations:  An( "ro'i(e(8 0ur!er, 1hat it "uild6+ease6 rolling stoc9s li9e of a public utility,
shall have no authority to reCuire steamboats, motor ships and steamship 1ransfer the coaches, rail but it does not
lines, whether privately6owned, or owned or operated by any overnment agreement where stations, terminals reCuire
controlled corporation or instrumentality to obtain certificate of public the foreign corp and the power a franchise before
convenience or to prescribe their definite routes or lines of service. will underta9e to plant, not a public one can o2n the
build and finance utility. hile a facilities needed to
Wa! a""ene( !o !e PSC% t has been abolished. ;owever, the P!A subsists. the %R1 pro#ect, franchise is needed operate a public
and upon to operate these utility so long as it
"rief history of the P! lifted from 2ootnote 5 in F%' v. arcia:  completion, they facilities to serve does not operate
 1he Americans introduced the regulation of public utilities. will deliver the use the public, they do them to serve the
 Regulatory bodies were created, namely: and possession of not by themselves public.
. oastw
oastwise
ise Rate
Rate omm
ommiss ission
ion the pro#ect by way constitute a public
5. "oard
"oard of Rate
Rate Regu
Regulat
lation
ion of lease for 54 utility. hat
0. "oard
"oard of Publi
Publicc 'tility
'tility omm
ommiss ission
ion years to the constitutes a public
?. Public
Public 'tilit
'tilityy omm
ommissission
ion B1. utility is not their
 Buring the ommonwealth era, the /ational Assembly passed A ?> or the ownership but their
Public !ervice Act, creating the P!. use to serve the
 PB  was issued in 3-5: public.
6 abol
abolis
ishi
hing
ng the
the P!
P!,, and
and
6 replac
replacing
ing it with
with 0 regu
regulatlatory
ory board
boards:
s: Teresa 1eresa &lectric 2ilipinas does not  A utility not
. "oard
"oard of 1ransp
1ransportortati
ation
on Elec!ric operated an need a intended for public
5. "oard
"oard of ommu
ommunic nicati
ation
on '. PSC electric plant municipal$legislativ service, but merely
:  of
 of ,- 
 under a subsisting e franchise for it to for its own use, is !ection >.
P/. 2ilipinas be entitled to a not a public utility
ement orp. is P/, as its which reCuires a  1he use of property bears a social function, and all economic agents shall
engaged in the purpose for legislative$municipal contribute to the common good. In(i'i(uals an( "ri'a!e )rou"s ,
manufacture and wanting to put up franchise. including corporations, cooperatives, and similar collective organi8ations,
sale of cement, for an electric plant is shall have the ri)! !o o2n8 es!a#lis8 an( o"era!e econo/ic
which business it exclusively to cater en!er"rises8 su#7ec! !o !e (u!$ o0 !e S!a!e  to promote distributive
wished to install to its own use and  #ustice and !o in!er'ene 2en !e co//on )oo( so (e/an(s .
and operate an not to render public !ection .
electric plant for service.
its factory and  No 0rancise8 cer!i0ica!e8 or an$ o!er 0or/ o0 au!ori+a!ion 0or !e
employees. o"era!ion o0 a "u#lic u!ili!$ sall #e )ran!e( e<ce"! !o ci!i+ens o0
!e Pili""ines or !o cor"ora!ions or associa!ions or)ani+e( un(er
!e la2s o0 !e Pili""ines8 a! leas! si<!$ "er cen!u/ o0 2ose
ca"i!al is o2ne( #$ suc ci!i+ens E nor shall such franchise, certificate, or
Rele'an! "ro'ision:
authori8ation be exclusive in character or for a longer period than fifty years.
Public !ervice Act, !ection ?: /either shall any such franchise or right be granted except under the
condition that it shall be su#7ec! !o a/en(/en!8 al!era!ion8 or re"eal
 +ist of enterprises not covered by the definition of public service: #$ !e Con)ress 2en !e co//on )oo( so re&uires . 1he !tate shall
. arehouses encourage eCuity participation in public utilities by the general public. 1he
5. ehicles drawn by animals, and bancas moved by oar or sail, and participation of foreign investors in the governing body of any public utility
tugboats and lighters enterprise shall be limited to their proportionate share in its capital, and all
0. Airships within the Philippines, except as regards the fixing of their !e e<ecu!i'e an( /ana)in) o00icers o0 suc cor"ora!ion or
maximum rates on freight and passengers associa!ion /us! #e ci!i+ens o0 !e Pili""ines .
?. Radio companies, except with respect to fixing of rates
4. Public services owned or operated by any instrumentality of the /ational !ection -.
overnment or by any , except with respect to fixing of rates.
 In !i/es o0 na!ional e/er)enc$8 2en !e "u#lic in!eres! so
Nature of Concession Agreements re&uires8 !e S!a!e /a$8  during the emergency and under reasonable
terms prescribed by it, !e/"oraril$ !a9e o'er or (irec! !e o"era!ion
A!& 2A1! ;&+B$RA1 B1R/& +A!! o0 an$ "ri'a!el$=o2ne( "u#lic u!ili!$ or #usiness a00ec!e( 2i!
11+& /1&! "u#lic in!eres!.
;ree(o/ %!!, a government %anila oncessionair
!ection 7.
0ro/ corporation, entered into ater and es are not
De#! concession arrangements %aynilad are mere agents.  1he !tate may 8 in !e in!eres! o0 na!ional 2el0are or (e0ense8
Coali!ion with private entities, %anila public es!a#lis an( o"era!e 'i!al in(us!ries an(8 u"on "a$/en! o0 7us!
'. *WSS ater and %aynilad. 1he utilities and co/"ensa!ion8 !rans0er !o "u#lic o2nersi" u!ili!ies an( o!er
%!! issued a /otice of not #ust "ri'a!e en!er"rises !o #e o"era!e( #$ !e Go'ern/en! .
&xtraordinary Price agents.
 Ad#ustment (/&PA) to both !ection 3.
concessionaires, which was
opposed by the latter.  1he !tate shall re)ula!e or "roi#i! /ono"olies 2en !e "u#lic
in!eres! so re&uires . /o combinations in restraint of trade or unfair
competition shall be allowed.

II. Cons!i!u!ional Pro'isions

Rele'an! "ro'isions: a. O2nersi"

37- onstitution, Article 5, /A1/A+ &/%G A/B PA1R%/G  Class no!es:

>  of ,- 
Rao on the limitaon of foreign parcipaon: eecve control by Filipinos   Ac!s re&uirin) !e a""ro'al o0 !e Co//ission :
(i) 1o sell8 aliena!e8 or in an$ /anner !rans0er sares o0 i!s ca"i!al
A!& 2A1! ;&+B$RA1 B1R/& +A!! stoc9 to any alien if the result of that sale, alienation, or transfer in itself or
11+& /1&! in connection with another previous sale shall be the re(uc!ion !o less
Ga/#oa P+B1 a franchise and the 1he term 1he term !an ?-@ o0 !e ca"i!al s!oc9 #elon)in) !o ;ili"ino ci!i+ens. !uch
'. Te'es right to engage in  IcapitalJ only  IcapitalJ only sale, alienation, or transfer shall be void and of no effect and shall be
54-,,6 telecommunications covers shares covers sufficient cause for ordering the cancellation of the certificate.
business. 1&, an American with the right 'o!in)
company and a ma#or to vote. shares. b. Exclusivity
stoc9holder of P+B1, sold its
outstanding shares to P1. A!& 2A1! ;&+B$RA1 B1R/& +A!!
?>H of the shares of P1 11+& /1&!
were sold to P;, and the *e!ro  Adala applied for a 1he prohibition  A franchise,
remaining 4?H to 2irst Ce#u P to operate a mentioned is void certificate, or
Pacific, a foreign investment Wa!er '. waterwor9s system. for being authori8ation
firm. &ventually, the shares  A(ala 1his was opposed by unconstitutional. cannot be
held by 2irst Pacific grew to %etro ebu,  Article ?, !ection exclusive.
7H. contending that 4, 3-0
Ga/#oa %R of the previous case. 1he term 1he term pursuant to PB 37, onstitution
'. Te'es  IcapitalJ  IcapitalJ the consent of the (which is also
54-,46 covers both covers both districtDs "oard of reflected in the
common the 'o!in) Birectors is reCuired. 37-) prohibits
shares with an( !e the exclusivity of a
the right to non='o!in) franchise.
vote as well shares. Ta2an) 1awang applied for +a 1rinidad cannot 1he ongress
as shares '. La a P for the have an exclusive cannot grant an
with Trini(a( operation and franchise. exclusive
beneficial maintenance of a franchise. /either
ownership. waterwor9s system can it delegate
in a barangay in the power to
"enguet. +a 1rinidad grant the same
opposed this, to administrative
Rele'an! "ro'isions: contending that the bodies.
Public !ervice Act, !ection > (a):  said barangay is
covered by its
 Proceedings of the P! upon notice and hearing: franchise which it
(a) To issue cer!i0ica!es  authori8ing the operation of public services claims to be
within the Philippines whenever the ommission finds that the operation exclusive.
of the public service proposed and the authori8ation to do business 2ill
"ro/o!e !e "u#lic in!eres!  in a proper and suitable manner.
Provided that certificates will be granted onl$ !o ci!i+ens o0 !e
c. ub!ect to Amen"ment
Pili""ines or o0 !e US  or to corps., co6partnerships, associations, or
 #oint6stoc9 companies constituted and organi8ed under the laws of the A!& 2A1! ;&+B$RA1 B1R/& +A!!
PhilippinesE Provided, that ?-@ o0 !e s!oc9 or "ai(=u" ca"i!al 11+& /1&!
must belong entirely to citi8ens of the Philippines or of the '!E Provided RCPI RP operates a radio RP may extend  A franchise is
further, that no suc cer!i0ica!e sall #e issue( 0or a "erio( o0 '. NTC communications the coverage of sub#ect to
/ore !an - $ears . networ9 in !orsogon its operations to amendment,
Public !ervice Act, !ection 5@(i)  under a franchise, atarman and alterations, or
and eventually in !an <ose, on the modification.

  of ,- 
 atarman and !an ground that its with public
<ose. Fayumanggi, original franchise interest.
also operating in !an may be  A)an 1he government 1he PA1 !ection 3, Art. L
<ose and atarman, amended. '. granted PA1 contracts would of the 37-
sued RP for Pi!aco the exclusive right create a onstitution
operating in !an <ose to operate /AA 0. monopoly in the mandates that the
and atarman "y virtue of the operation of !tate prohibit or
without a franchise. PA1 ontracts, an international regulate monopolies
/AA 0 would be commercial when public interest
the only passenger airport so reCuires.
Rele'an! "ro'isions: international at the /AA in %onopolies are not
passenger airport favor of PA1 per se prohibited.
Public !ervice Act, !ection >:  operating in the iven its
sland of +u8on, susceptibility to
(m) To a/en(8 /o(i0$8 or re'o9e a! an$ !i/e an$ cer!i0ica!e  under the with the exception abuse, however, the
provisions of this act, whenever the facts and circumstances on the strength of which of those already !tate has the
sai( cer!i0ica!e 2as issue( a'e #een /isre"resen!e( or /a!eriall$ operating in !ubic bounden duty to
can)e(. "ay 2reeport regulate monopolies
(n) To sus"en( or re'o9e an$ cer!i0ica!e  issued under the provisions of this act !pecial &conomic to protect public
whenever the ol(er !ereo0 as 'iola!e( or 2ill0ull$ an( consu//a!el$ Kone, lar9 interest.
re0use( !o co/"l$ 2i! an$ or(er8 rule or re)ula!ion o0 !e Co//ission or !pecial &conomic
an$ "ro'isions o0 !is ac! E Provided, that the ommission for good cause may, Kone and in +aoag
prior to the hearing, suspend for a period not exceeding 0@ days any certificate or the ity.
exercise of any right or authority issued or granted under this act, by order of the
ommission, whenever such step shall, in the #udgment of the ommission, be
necessary to avoid serious and irreparable damage or inconvenience to the public or e. Pri'a!i+a!ion o0 S!a!e=O"era!e( Pu#lic U!ili!ies
to private interest.
A!& 2A1! ;&+B$RA1 B1R/& +A!!
". #a$e%over &o'er 11+& /1&!
3u2ai! Fuwait and PA+ , PA+ was 1he government
A!& 2A1! ;&+B$RA1 B1R/& +A!!  Air2a$s then owned by the already a cannot act to
11+& /1&! '. PAL government, private deprive public
Da'i( Pres. Arroyo  Although the n times of national entered into a company (no utilities of their
'. issued PP @-, President can emergency, the ommercial longer owned private rights when
 Arro$o declaring a state declare a state of President may  Agreement. PA+ by the these public
of national national declare the existence eventually was government) at utilities, although
emergency and emergency, a of such state but privati8ed. A the time it previously state6
invo9ing !ection legislation is only the ongress ommercial %emo signed the owned, have
-, Article 5 of needed to allow has the power to of 'nderstanding %'. t was already been
the onstitution. her to exercise determine / the (%') was later on thus no longer privati8ed.
emergency operations of signed by certain bound by the ;owever, such
powers. Absent privately owned officials of the acts of the privati8ed public
such legislation, business affected Philippine government as utilities remain
she cannot ta9e with public interest government, which manifested by sub#ect to !tate
over the or of a public utility memo departs from the signing of regulation.
operation of should be ta9en over the previously the %'.
privately owned by the !tate. concluded
business$public ommercial
utility affected  Agreement.
?  of ,- 
 PLDT '. &1 applied with 1he /1 may grant  A regulatory body
NTC the /1 for a provisional designated by the
III. Re)ula!ion o0 Pu#lic U!ili!ies P/ to operate authority. /1 is government can
Class no!es: and maintain a the regulatory perform acts of
cellphone system agency of the regulation within its
1he !tate can be the: and a paging national competence.
system. /1 government with
. regulator granted it  #urisdiction over all
5. operator provisional telecommunications
;ow can the !tate (government) end up as the owner and operator* authority. P+B1 entities.
Cuestions this.
. !elling ;rancisc P/ entered "y virtue of PB 1he ongress may
5. "1 o '. TRB into #oint venture 5, 1R" has delegate its
0. reated from the beginning agreements with sufficient power to authority to
private entities grant a person or regulate public
1here is a constitutional provision which provides that govMt itself can operate public
for toll operation. entity to construct, utilities to
utilities. Ratio : to provide low cost services especially on those sector where there is
n issue here is maintain and administrative
low return of investment.
the authority of operate a toll bodies.
&xamples of utilities operated by the government: the 1R" to grant facility and issue a
franchises. corresponding toll
. +R1 operating permit.
5. ater districts from some provinces NAPOCO /P acted to /P acted beyond  A regulatory body
R '. CA supply power in its competence. designated by the
Pri'a!i+a!ion '. Na!ionali+a!ion: areas where 1he generation of government can
&PA+ has a electric power shall perform acts of
Privati8ation 6 govMt sells its interest in public utilities franchise for be underta9en regulation /+G
/ationali8ation 6 govMt underta9es to reacCuire public utilities light, heat and solely by the /P within its
power supply. but the distribution competence.
of electric power
shall be underta9en
A. Authority to (perate by cooperatives,
private utilities
A!& 2A1! ;&+B$RA1 B1R/& +A!!
(such as the
11+& /1&!
&PA+), local
 Al#ano 1he %1 pro#ect 1he PPA has been 1he authority to governments and
'. Re$es was awarded to granted the operate may come other entities duly
1! by the PPA authority to award from not only the authori8ed.
after the bidding. the operation and ongress, but also
management of the from administrative
%1 to whichever agencies to which
entity it deems the ongress has Rele'an! "ro'isions:
suitable. "y virtue delegated such
Public !ervice Act, !ection > (a): 
of the contracts authority.
entered into  Proceedings of the P! upon notice and hearing:
between the )a* To issue cer!i0ica!es au!ori+in) !e o"era!ion o0 "u#lic
parties, 1! ser'ices 2i!in !e Pili""ines 2ene'er !e Co//ission 0in(s
earned the !a! !e o"era!ion o0 !e "u#lic ser'ice "ro"ose( an( !e
authority to operate au!ori+a!ion !o (o #usiness 2ill "ro/o!e !e "u#lic in!eres! in
the %1. a "ro"er an( s ui!a#le /anner. Provided that certificates will be

  of ,- 
 granted only to citi8ens of the Philippines or of the '! or to corps., co6 the public interest in a
partnerships, associations, or #oint6stoc9 companies constituted and proper and suitable
organi8ed under the laws of the PhilippinesE Provided, that >@H of the manner.
stoc9 or paid6up capital must belong entirely to citi8ens of the 3*U +12R" granted ne of the 1he applicant for a P Public
Philippines or of the '!E Provided further, that no such certificate shall '. the provincial reCuirements for must prove that there is convenie
be issued for a period of more than 4@ years. Garcia bus operators the grant of a a public need for the nce and
to set the fare P is that the public utility it is necessity
Public !ervice Act, !ection 7: 
rates, the applicant must applying a P for. exists
 t shall be unlawful for any individual, co6partnership, association, former prove that the when the
corporation or #oint6stoc9 company, their lessees, trustees, or receivers to providing only operation of the proposed
engage in any public service business without having first secured from the a range within public service facility or
ommission a certificate, except grantees of legislative franchises expressly which the rates proposed and service
exempting such grantee from the reCuirements of securing a certificate from should fall. the authori8ation  meets a
the ommission, as well as those expressly exempted from the #urisdiction to do business reasonabl
of the ommission. will promote the e want of 
public interest in the public
i. +eneral ,uali-caons a proper and and
suitable manner . supply a
A!& 2A1! ;&+B$RA1 B1R/& +A!! 1he burden of need
11+& /1&! proof is on the which the
 V(a. Bia8 applied 1he grant of ReCuisites for the grant applicant. existing
(e La! for a P/ P/ was of a P/: () the facilities
'. PSC with the P! proper. Bia8 applicant must be a do not
to operate an satisfied all the citi8en of the adeCuatel
ice plant reCuisites. A Philippines, or a y supply.
system. 1his mere reduction in corporation or co6
was granted. the earnings of partnership, association
competitor6 or #oint stoc9 company
businesses does constituted and ii. Revocaon or Cancellaon
not suffice to organi8ed under the
A!& 11+& 2A1! ;&+B$RA1 B1R/& +A!! /1&!
constitute laws of the Philippines,
Di'ina)racia Bivinagracia 1hough /1 ndustries over 1he court
ruinous >@ per centum at least
'. CBS sought has the which the P! loo9ed into the
competition. of the stoc9 or paid6up
before the authority to does not have power granted
capital of which belong
/1 the grant Ps, it  #urisdiction are to /1. s a
entirely to citi8ens of
cancellation$ does not have li9ewise spared radio
the PhilippinesE (5) the
revocation of  the power to from the broadcasting
applicant must be
the cancel$revo9e  #urisdiction of company a
financially capable of
franchises the same, the public utility*
underta9ing the
granted to absent any law administrative /o. 1he
proposed service and
P"! and authori8ing entities element that is
meeting the
"!, alleging them. Although subseCuently missing is Nfor
responsibilities incident
that P"! and the P! replacing the hire or
to its operationsE and
"! failed to originally had P!. compensationN.
(0) the applicant must
comply with the power to
prove that the operation
the cancel$revo9e,
of the public service
conditions the same did
proposed and the
set forth in not pass on to
authori8ation to do
their the /1 as
business will promote
respective broadcast
  of ,- 
 legislative stations were CPC CPCN
franchises. not under the /o franchise reCuired 2ranchise reCuired
P!Ds authority  Auto6truc9s, motor vehicles, etc. Power, telephone, etc.
bac9 then.

A!& 2A1! ;&+B$RA1 B1R/& +A!! /1&!

Rele'an! "ro'ision: 11+&
PAL randAir randAir does not 1he law (as 1his case
Public !ervice Act, !ection > (m): 
'. applied for a need a legislative embodied in the abolished the
 To a/en(8 /o(i0$8 or re'o9e a! an$ !i/e an$ cer!i0ica!e  under the CAB P/ for the franchise, considering onstitution and distinction
provisions of this act, whenever the facts and circumstances on the strength operation of an that it has fulfilled all the Public between Ps
of which sai( cer!i0ica!e 2as issue( a'e #een /isre"resen!e( or air transport the necessary !ervice Act) and P/s.
/a!eriall$ can)e( . service. 1his Cualifications for the contemplates
was opposed issuance of a P/. not only
iii. CPC '. CPCN by PA+ who is !ection ? of RA -->  IfranchisesJ,
a holder of a enumerated the but also
Rele'an! Pro'ision:
legislative reCuirements to  IcertificatesJ
Public !ervice Act, !ection 4:  franchise for determine the (P$P/).
the same field. competency of a
prospective operator.
 ith the exception of those enumerated in the preceding section, no "u#lic
ser'ice sall o"era!e in !e Pili""ines 2i!ou! "ossessin) a 'ali(
an( su#sis!in) cer!i0ica!e  from the Public !ervice ommission 9nown as
cer!i0ica!e o0 "u#lic con'enience8 or cer!i0ica!e o0 "u#lic B. Ra!e=;i<in)
con'enience an( necessi!$8  as the case may be, to the effect that the
Rele'an! "ro'isions:
operation of said service and the authori8ation to do business will promote
the public interests in a proper and suitable manner. Public !ervice Act, !ection > (c): Proceedings of the ommission, upon notice and
hearing.
1he ommission may prescribe as a condition for the issuance of the
certificate provided in the preceding paragraph that !e ser'ice can #e  1o 0i< an( (e!er/ine in(i'i(ual or 7oin! ra!es8 !olls8 car)es8
classi0ica!ions8 or sce(ules  thereof, as well as co//u!a!ion8
ac&uire( #$ !e Re"u#lic o0 !e Pili""ines or an$ ins!ru/en!ali!$
!ereo0 u"on "a$/en! o0 !e cos! "rice o0 i!s use0ul e&ui"/en!8 less /ilea)e8 9ilo/e!ra)e8 an( o!er s"ecial ra!e s which shall be imposed
reasona#le (e"recia!ion E and li9ewise, that the certificate shall be 'ali(
observed and followed thereafter by any public service: Provided, 1hat !e
Co//ission /a$8 in i!s (iscre!ion8 a""ro'e ra!es "ro"ose( #$
onl$ 0or a (e0ini!e "erio( o0 !i/e E and that the 'iola!ion o0 an$ o0
!ese con(i!ions sall "ro(uce !e i//e(ia!e cancella!ion of the "u#lic ser'ices "ro'isionall$ an( 2i!ou! necessi!$ o0 an$ earin) E
certificate without the necessity of any express action on the part of the but it shall call a hearing thereon within thirty days, thereafter, upon
ommission. publication and notice to the concerns operating in the territory affected:
Provided, further, 1hat in case the public service eCuipment of an operator
is used principally or secondarily for the promotion of a private business, the
n estimating the depreciation, the effect of the use of the eCuipment, its net profits of said private business shall be considered in relation with the
actual condition, the age of the model, or other circumstances affecting its public service of such operator for the purpose of fixing the rates.
value in the mar9et shall be t a9en into consideration.
Public !ervice Act, !ection 5@ (a):  Acts reCuiring the approval of the ommission.
1he foregoing is li9ewise applicable to any e<!ension or a/en(/en! o0  To a(o"!8 es!a#lis8 0i<8 i/"ose8 /ain!ain8 collec! or carr$ in!o
cer!i0ica!es actually in force and to those which may hereafter be issued, e00ec! an$ in(i'i(ual or 7oin! ra!es8 co//u!a!ion8 /ilea)e or o!er
to permit to modify itineraries and time schedules of public services, and to s"ecial ra!e8 !oll8 0are8 car)e8 classi0ica!ion or i!inerar$. 1he
authori8ations to renew and increase eCuipment and properties. ommission shall a""ro'e onl$ !ose !a! are 7us! an( reasona#le
an( no! an$ !a! are un7us!l$ (iscri/ina!or$ or un(ul$ "re0eren!ial ,
Class no!es: only upon reasona#le no!ice  to the public services and other parties
  of ,- 
 concerned, giving them a reasonable o""or!uni!$ !o #e ear(  and the public utility alone
#ur(en o0 !e "roo0 to show that the proposed rates or regulations are (to the exclusion of
 #ust and reasonable shall be u"on !e "u#lic ser'ice  proposing the same. the consuming
public).
Class no!es:
3*U '. +12R" granted 1he power to fix the 1he regulatory
Procedure: Garcia the provincial rates rests in the power vested in
bus operators +12R", as delegated the ongress,
. Application by the public utility to set the fare by ongress. 1he or
5. /otice and hearing rates, the former cannot sub6 administrative
0. Approval$Benial by the regulatory body former delegate the same bodies as the
providing only to the bus operators. case may be,
a range within includes the
A!& 2A1! ;&+B$RA1 B1R/& +A!! /1&! which the rates authority to fix
11+& should fall. rates. 1he
Pa(ua 1R" issued a 1R"Ds authority to 1he rate6fixing  A public same cannot be
'. resolution grant provisional toll power of the hearing for delegated to
Rana(a which rate ad#ustments 1R" may be rate6fixing is the public
authori8ed does not reCuire the done ex6parte, not necessary utilities
provisional toll posting of notices thereby not if the main themselves or
rate and the conduct of a reCuiring notice petition is their operators.
ad#ustments at hearing. and hearing. sufficient, ;rancis P/ entered 1he promulgation of 1he 1R" is 1he power to
the !9yway, in there is a co '. into #oint toll rates is within vested the set rates and
view of Iurgent submission of  TRB venture the competence of power to fix toll the executive
public bond and an agreements the 1R". rates, in the power to
interest.J  affidavit is with private exercise of its grant
submitted entities for toll Cuasi6legislative franchises
showing that operation. functions. can be both
the rate6 granted to
fixing formula  #ust one
was complied entity.
with. &xamples are
Re"u#li %eralco filed n determining the Rates must be Rate fixing A", +21R",
c '. with the  #ust and reasonable  #ust and could be very etc.
*eralc &nergy rates to be charged reasonable, technical so
o Regulation by a public utility, 0 that which will most of the
"oard (&R") factors are yield a fair time it is
an application considered: ) rate return to the delegated to C. A""ro'al o0 Sales o0 Pu#lic U!ili!$ Asse!s or E&ui!$
for the revision of returnE 5) rate public utility a speciali8ed Rele'an! "ro'isions:
of its rate baseE 0) computed and reasonable agencies.
schedules. revenue. 1he to the public. Public !ervice Act, !ection 5@:  Acts reCuiring the approval of the ommission.
operating expenses
are deducted from (g) To sell8 aliena!e8 /or!)a)e8 encu/#er or lease i!s "ro"er!$8 0rancises8
the rate base. cer!i0ica!es8 "ri'ile)es8 or ri)!s or an$ "ar! !ereo0 or /er)e or
ncome tax, consoli(a!e i!s "ro"er!$8 0rancises "ri'ile)es or ri)!s8 or an$ "ar! !ereo08
however, are not to 2i! !ose o0 an$ o!er "u#lic ser'ice . 1he approval herein reCuired shall be
be considered given, after notice to the public and hearing the persons interested at a public
operating expenses hearing, if it be shown that there are #ust and reasonable grounds for ma9ing the
and must be mortgaged or encumbrance, for liabilities of more than one year maturity, or the sale,
shouldered by the alienation, lease, merger, or consolidation to be approved, and that the same are not

,-  of ,- 
detrimental to the public interest, and in case of a sale, the date on which the same PLDT '. P+B1 Cuestions the nly the transfer of  1he sale of
is to be consummated shall be fixed in the order of approval: Provided, however, that NTC provisional authority franchise reCuires shares of stoc9 
nothing herein contained shall be construed to prevent the transaction from being granted by the /1 ongressional of a public
negotiated or completed before its approval or to prevent the sale, alienation, or to &1 to operate approval. 1he sale utility reCuires
lease by any public service of any of its property in the ordinary course of its and maintain a of shares of stoc9 the approval of 
business. cellphone system of &1 needs only the regulatory
and a paging the approval of the body
(h) To sell or re)is!er in i!s #oo9s !e !rans0er or sale o0 sares o0 i!s ca"i!al system, on the /1 which it exercising
s!oc98 i0 !e resul! o0 !a! sale in i!sel0 or in connec!ion 2i! ano!er ground that the sale impliedly gave  #urisdiction
"re'ious sale8 sall #e !o 'es! in !e !rans0eree /ore !an 0or!$ "er cen!u/ of ?@H of the upon the issuance over the said
o0 !e su#scri#e( ca"i!al o0 sai( "u#lic ser'ice.  Any transfer made in violation shares of stoc9 of of the provisional public utility.
of this provision shall be void and of no effect and shall not be registered in the &1 reCuired authority to &1.
boo9s of the public service corporation. /othing herein contained shall be construed ongressional
to prevent the holding of shares lawfully acCuired. approval.
 Y Transi!  Gu#uico 1ransit 1he transfer of 1he rule
Co. '. transferred @ of its ownership over the reCuiring the
(i) To sell8 aliena!e or in an$ /anner !rans0er sares o0 i!s ca"i!al s!oc9 !o
NLRC buses to its @ buses from approval of the
an$ alien i0 !e resul! o0 !a! sale8 aliena!ion8 or !rans0er in i!sel0 or in
president, who then  Gu#uico to G 1ransit P! with
connec!ion 2i! ano!er "re'ious sale sall #e !e re(uc!ion !o less !an
sold it to G transit. does not bind the respect to
si<!$ "er cen!u/ o0 !e ca"i!al s!oc9 #elon)in) !o Pili""ine ci!i+ens. !uch
 A labor union in public, absent the franchises
sale, alienation or transfer shall be void and of no effect and shall be sufficient cause
 Gu#uico filed a '+P approval of the applies here.
for ordering the cancellation of the certificate.
case against the "1. Gu 1ransit
former which led to may, however,
A!& 2A1! ;&+B$RA1 B1R/& +A!! a levy being made claim from Gu#uico.
11+& /1&! upon the @ buses.
*on!o$a  A #eep and a bus 1he owner, not the  A lease of a  All the transactions
'. collided. 1he issue is lessee, is liable to public utility did not secure the
I)nacio on who is to be held the victims, the without the approval of the "1.
responsible to the lease not having approval of the
victims when the been secured by P! does not
said #eep was the approval of the bind the
D. Po2er !o Se! ;ees an( o!er Car)es
leased, without the P!. public.
approval of the P!, A!& 11+& 2A1! ;&+B$RA1 B1R/& +A!!
at the time of the /1&!
accident. Re"u#lic , a holder of a 1he imposition of  A regulatory
Pere+ '.  A #eepney carrying 1he registered  A sale of a '. ICC franchise, applied the said permit body of public
Gu!ierre+ passengers met an owner is liable, the public utility for a P/ for the fee is a valid utilities may
accident. 1his approval of the P! without the operation of exercise of impose fees
 #eepney has of the said sale not approval of the international regulatory power. and other
previously been sold having been P! does not telecom leased t is not a tax as it charges
to another, which secured. 1he bind the circuit service. /1 does not aim to pursuant to a
sale was not registered owner public. sub#ected the grant raise revenue, but valid exercise
approved by the may however claim of provisional merely to of regulatory
P!. ho between from the authority to the reimburse the /1 powers.
the registered owner subseCuent payment of a of its expenses in
and the subseCuent purchaser. permit fee. the regulation of
purchaser is to be public utilities.
held liable to the
in#ured passengers*

,, of ,- 
E. O!er *eans o0 Re)ula!ion
Rele'an! Pro'isions:
Public !ervice Act, !ection >: Proceedings of the ommission, upon notice and
hearing.
(b) 1o approve, sub#ect to constitutional limitations any franchise or privilege granted
under the provisions of Act /o. !ix ;undred and !ixty6seven, as amended by Act /o.
ne 1housand and twenty6two, by any political subdivision of the Philippines when, in
the #udgment of the ommission, such franchise or privilege will properly conserve
the public interests, and the ommission shall in so approving impose such conditions
as to construction, eCuipment, maintenance, service, or operation as the public
interests and convenience may reasonably reCuire, and to issue certificates of public
convenience and necessity when such is reCuired or provided by any law or franchise.
(d) 1o fix #ust and reasonable standards, classifications, regulations, practices,
measurement, or service to be furnished, imposed, observed, and followed thereafter
by any public service.
(e) 1o ascertain and fix adeCuate and serviceable standards for the measurement of
Cuantity, Cuality, pressure, initial voltage, or other condition pertaining to the supply
of the product or service rendered by any public service, and to prescribe reasonable
regulations for the examination and test of such product or service and for the
measurement thereof.
(f) 1o establish reasonable rules, regulations, instructions, specifications, and
standards, to secure the accuracy of all meters and appliances for measurements.
(g) 1o compel any public service to furnish safe, adeCuate, and proper service as
regards the manner of furnishing the same as well as the maintenance of the
necessary material and eCuipment.
(h) 1o reCuire any public service to establish, construct, maintain, and operate any
reasonable extension of its existing facilities, where in the #udgment of said
ommission, such extension is reasonable and practicable and will furnish sufficient
business to #ustify the construction and maintenance of the same and when the
financial condition of the said public service reasonably warrants the original
expenditure reCuired in ma9ing and operating such extension.
(i) 1o direct any railroad, street railway or traction company to establish and maintain
at any #unction or point of connection or intersection with any other line of said road
or trac9, or with any other line of any other railroad, street railway or traction to
promote, such #ust and reasonable connection as shall be necessary to promote the
convenience of shippers of property, or of passengers, and in li9e manner direct any
railroad, street railway, or traction company engaged in carrying merchandise, to
construct, maintain and operate, upon reasonable terms, a switch connection with
any private sidetrac9 which may be constructed by any shipper to connect with the
railroad, street railway or traction company line where, in the #udgment of the
ommission, such connection is reasonable and practicable and can be out in with
safety and will furnish sufficient business to #ustify the construction and maintenance
of the same.
(#) 1o authori8e, in its discretion, any railroad, street railway or traction company to
lay its trac9s across the trac9s of any other railroad, street railway or traction
company or across any public highway.
(9) 1o direct any railroad or street railway company to install such safety devices or
about such other reasonable measures as may in the #udgment of the ommission be
necessary for the protection of the public are passing grade crossing of () public
highways and railroads, (5) public highways and streets railway, or (0) railways and
street railways.
(l) 1o fix and determine proper and adeCuate rates of depreciation of the property of
any public service which will be observed in a proper and adeCuate depreciation
account to be carried for the protection of stoc9holders, bondholders or creditors in
accordance with such rules, regulations, and form of account as the ommission may
prescribe. !aid rates shall be sufficient to provide the amounts reCuired over and
above the expense of maintenance to 9eep such property in a state of efficiency
corresponding to the progress of the industry. &ach public service shall conform its
depreciation accounts to the rates so determined and fixed, and shall set aside the
moneys so provided for out of its earnings and carry the same in a depreciation fund.
1he income from investments of money in such fund shall li9ewise be carried in such
fund. 1his fund shall not be expended otherwise than f or depreciation,
improvements, new construction, extensions or conditions to the properly of such
public service.
(o) 1o fix, determine, and regulate, as the convenience of the state may reCuire, a
special type for auto6busses, truc9s, and motor truc9s to be hereafter constructed,
purchased, and operated by operators after the approval of this ActE to fix and
determine a special registration fee for auto6buses, truc9s, and motor truc9s so
constructed, purchased and operated: Provided, 1hat said fees shall be smaller than
more those charged for auto6busses, truc9s, and motor truc9s of types not made
regulation under the subsection.
Public !ervice Act, !ection 5@:  Acts reCuiring the approval of the ommission.
(b) 1o establish, construct, maintain, or operate new units or extend existing facilities
or ma9e any other addition to or general extension of the service.
(c) 1o abandon any railroad station or stop the sale of passenger tic9ets, or cease to
maintain an agent to receive and discharge freight at any station now or hereafter
established at which passenger tic9ets are now or may hereafter be regularly sold, or
at which such agent is now or may hereafter be maintained, or ma9e any permanent
change in its time tables or itineraries on any railroad or in its service.
,4  of ,- 
(d) 1o lay any railroad or street railway trac9 across any highway, so as to ma9e a
new crossing at grade, or cross the trac9s of any other railroad or street railway,
provided, that this subsection shall not apply to replacements of lawfully existing
trac9s.
(e) ;ereafter to issue any stoc9 or stoc9 certificates representing an increase of
capitalE or issue any share of stoc9 without par valueE or issue any bonds or other
evidence of indebtedness payable in more than one year from the issuance thereof,
provided that it shall be the duty of the ommission, after hearing, to approve any
such issue maturing in more than one year f rom the date thereof, when satisfied that
the same is to be made in accordance with law, and the purpose of such issue be
approved by the ommission. (f) 1o capitali8e any franchise in excess of the amount,
inclusive of any tax or annual charge, actually paid to the overnment of the
Philippines or any political subdivision thereof as the consideration of said franchiseE
capitali8e any contract for consolidation, merger or lease, or issue any bonds or other
evidence of indebtedness against or as a lien upon any contract for consolidation,
merger, or lease: Provided, however, that the provisions of this section shall not
prevent the issuance of stoc9, bonds, or other evidence of indebtedness sub#ect to
the approval of the ommission by any lawfully merged or consolidated public
services not in contravention of the provisions of t his section.
(#) 1o issue, give or tender, directly or indirectly, any free tic9et free pass or free or
reduced rate of transportation for passengers, except to the following persons: ()
officers, agents, employees, attorneys, physicians and surgeons of said public service,
and members of their familiesE (5) inmates of hospitals or charity institutions, and
persons engaged in charitable wor9E (0) indigent, destitute, and homeless persons
when transported by charitable societies or hospitals, and the necessary agents
employed in such transportationE (?) t he necessary careta9ers, going and returning,
of livestoc9, poultry, fruit, and other freight under uniform and non6discriminatory
regulationE (4) employees of sleeping car corporations, express corporations and
telegraph and telephone corporations, railway and marine mail service employees,
when traveling in the course of their official dulyE (>) post6office inspectors, customs
officers and inspectors, and immigration inspectors when engaged in inspectionE (-)
witnesses attending any legal investigation in which the public service is an interested
partyE (7) persons in#ured in accidents or wrec9s, and physicians and nurses
attending such personsE (3) peace officers and men of regularly constituted fire
departments.
(9) Adopt, maintain, or apply practices or measures, rules or regulations to which the
public shall be sub#ect in its relations with the public service.
A!& 2A1! ;&+B$RA1 B1R/& +A!!
11+& /1&!
NPC /P acted to 1he /P does not  Another means of
'. CA supply power in have the authority regulation is the
areas where to determine determination of which
&PA+ has a whether or not it between two public
franchise for can supply utilities has the right to
light, heat and electricity to the render service to the
power supply. areas involved in public in a given area.
this dispute. 1he
same is vested in
the B&.
(Pau airanod)
PART TWO: TRANSPORTATION LAW
II. General Discussion
,. De0ini!ion
Class No!es:
6 Removal of goods or persons from one place or another
6 ontract of transportation O one whereby a certain person or association of
persons obligate themselves to transport persons or things from one to another
for a fixed price
4. Rela!ionsi" !o a Pu#lic U!ili!$
Class No!es:
6 f you examine !ection 0(b) of the Public !ervice Act, various modes of
transportation are listed, thus putting such modes within the coverage of the
term Ipublic serviceJ if used by certain persons for hire or compensation, with
general or limited clientele.
a. Rele'an! Pro'isions:
P'"+ !&R& A1, !ection 0(b). (b) 1he term Npublic serviceN includes
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 f or general business purposes,
any common carrier, railroa(8 s!ree! rail2a$8 !rac!ion rail2a$8 su#=2a$
/o!or 'eicle8 ei!er 0or 0rei)! or "assen)er8 or #o! 2i! or 2i!ou!
0i<e( rou!e an( 2e!er /a$ #e i!s classi0ica!ion8 0rei)! or carrier
ser'ice o0 an$ class8 e<"ress ser'ice8 s!ea/#oa! or s!ea/si" line8
"on!ines8 0erries8 an( 2a!er cra0! , en)a)e( in !e !rans"or!a!ion o0
"assen)ers or 0rei)! or #o! , shipyard, marine railways, marine repair shop,
warehouseQ wharf or doc9, ice plant, ice6refrigeration plant, canal, irrigation
system, gas, electric light, heat and power water supply and power, petroleum,
sewerage system, wire or wireless communications system, wire or wireless
broadcasting stations and other similar public services: Provided, however, 1hat
a person engaged in agriculture, not otherwise a public service, who owns a
motor vehicle and uses it personally and$or enters into a special contract
whereby said motor vehicle is offered for hire or compensation to a third party or
third parties engaged in agriculture, not itself or themselves a public service, for
operation by the latter for a limited time and for a specific purpose directly
connected with the cultivation of his or their farm, the transportation, processing,
and mar9eting of agricultural products of such third party or third parties shall
not be considered as operating a public service for the purposes of this Act.
,:  of ,- 
. Na!ure o0 a ;rancise service, cannot be
ta9en or
Cases: interfered with
A!& 11+& 2A1! ;&+B B1R/& +A!! without due
/1&! process of law.
Raymundo /icanor de u8man as 1he ertificates of  G 1ransit  Gu#uico who sold the 1he 1he transfer of
v. +uneta u8co 1ransit attachment public o. v. /+R sub#ect buses of ownership of ownership from
%otor purchased truc9s from and convenience  Gu#uico 1ransit o. to the buses  Gu#uico 1ransit
+uneta %otor o. and execution in secured by public NGN 1ransit o., nc. wasnDt o., nc. to <esus
executed promissory favor of service operators  Gu#uico 1ransit properly  Gu#uico, and from
notes guaranteed by +uneta %otor are liable to &mployees 'nion filed transferred <esus Gu#uico to
a chattel mortgage. were valid. execution.f the complaints against to G 1ransit NGN 1ransit o.,
Be u8man failed to holder of a  Gu#uico 1ransit o., o. nc. lac9ed the
pay. arnishment was certificate of nc. for unfair labor prior approval of
issued against u8co public practice and non6 the "1 as
1ransitDs Ps. +uneta convenience can payment of living reCuired by
%otor o was the sell it voluntarily, allowances. An alias !ection 5@ of the
highest bidder. there is no valid writ of execution was Public !ervice Act.
;owever, the same reason why the issued upon the here the
certificates were later same certificate buses. 'nion says registered owner
sold by Be u8man to cannot be ta9en that the transactions is liable for
petitioner Raymundo. and sold leading to the transfer obligations to
involuntarily of the buses to NGN third parties and
pursuant to 1ransit o., nc. were vehicles
process. void because they registered under
lac9ed the approval of  his name are
ogeo6  A P was obtained 1he Assoc  A P is included the "1 as reCuired levied upon to
ubao by +ungsod !ilangan usurped in the term by the Public !ervice satisfy his
perator to ply the ogeo6 +ungsod NpropertyN and  Act. obligations, the
and Briver ubao route. 1roubled !ilanganDs can be sold. transferee of such
 Association by +ungsodMs "oard property !till,t is affected vehicles cannot
v. A Resolution /o. 3 rights with a public prevent the levy
adopting a "anderaM entitling the interest. 1hus, a by asserting his
!ystem, the Assoc latter to P does not ownership
decided to form a damages. confer upon the because as far as
human barricade on holder any the law is
and assumed the proprietary right concerned, the
dispatching of or interest or one in whose
passenger #eepneys franchise in the name the vehicle
which gave rise to the route covered is registered
suit for damages. thereby and in remains to be the
the public owner and the
highways. A P transferee merely
as property, holds the vehicles
representing the for the registered
right and owner
authority to
operate its >. Sco"e o0 a ;rancise
facilities for public
,>  of ,- 
Case: A!& 11+& 2A1! ;&+B B1R/& +A!!
A!& 2A1! ;&+B B1R/& +A!! /1&!
11+& /1&! "atangas rlanes was an / a Prior perator
!an Pablo Pantranco an a land f a river, stream 1ransportation irregular certificate of Rule: !o long
v. reCuested authority transportation or la9e interrupts v. rlanes operator public as the first
Pantranco to acCuire a boat company be a highway, a between convenience licensee
from the %aritime allowed to operate common carrier "antilan and going to be 9eeps and
ndustry Authority a ferry service or a need not apply for 1aal who see9s issued to a performs the
to operate a coastwise$inter6 a separate to have a P second terms and
ferryboat service island shipping certificate of to operate a line operator to conditions of
from areas in service as an public of auto truc9s operate a its license and
!amar for its buses incident to its convenience and set aside public utility complies with
and freight truc9s franchise because the water and nullify the in a field the
that had to cross 1;'1 having will be considered prohibition where, and reasonable
the !an "ernardo to file a separate a continuation of against him in in rules and
!trait. application* 2or a the highway. his P (he competition regulations of 
%A denied the ferry service, G&!. ;owever, the sea shall not have with, a first the
reCuest because 2or a cannot be or receive any operator ommission
the routes were coastwise$inter6 considered a passengers or who is and meets
already adeCuately island service, /. continuation of freight at any of  already the
covered. Pantranco the highway. the points operating, reasonable
invo9ed the ruling 1hus, a common served by the adeCuate demands of
in <avellana v carrier must apply "atangas and the public, it
Public !ervice for a separate 1ransportation). satisfactory should have
ommission, where certificate of "atangas service O / more or less
it was held that a public 1ransportation of a vested
ferry service is an convenience to alleged that and
allowable incident operate a sea grant rlanes preferential
to the transport of route. would result in right over a
passengers for the ruinous person who
purpose of competition and see9s to
Ncontinuing the to the grave acCuire
highwayN pre#udice of the another and a
interrupted by Na company and later license
small body of without any over the
water.N Pantranco benefit to the same route.
reasoned that the public. therwise,
use of the % the first
"lac9 Bouble was license would
in the concept of a not have
private carrier protection on
since it would only his
ferry its own investment,
passengers, buses and would be
and vehicles. sub#ect to
ruinous
. Prior O"era!or Rule competition
and thus
defeat the
Case:
,  of ,- 
 very purpose is the person
and intent for listed as owner
which the on the
Public !ervice tricycleDs
ommission registration
was created certificate.
+ita !pouses ourt  Although not
?. 3a#i! S$s!e/ &nterprises, campo should not outrightly
nc. v. purchased have ta9en penali8ed as a
Cases: !econd from the Belta cogni8ance criminal offense,
A!& 2A1! ;&+B B1R/& +A!! /1&! ivil ases %otor five cars of the case. the N9abit
11+& Bivision to be used as Parties in systemN is
1e#a v. A Pedro bought Parties are  Although Pedro taxicabs. !ince pari delicto recogni8ed as
a tricycle from in pari failed to pay for they had no being contrary to
1e#a %ar9eting delicto , so the tricycle, franchise to public policy and,
for no relief for <aucian was operate therefore, void
transportation either. engaging in the taxicabs, they and inexistent
services which 9abit system, contracted under. t is a
became the which is void with +ita fundamental
ob#ect of a because of public &nterprises, principle ( in pari
chattel policy based on nc. for the delicto) that the
mortgage with  ?@3. use of the court will not aid
the Rural "an9   Art. ?@3. 1he latterMs P. either party to
of amaligan following 1he cars were enforce an illegal
because Pedro contracts are registered in contract, but will
paid to pay. inexistent and the name of leave them both
<aucian, the void from the +ita where it finds
one who beginning: () &nterprises, them.
handled the 1hose whose nc.
mortgaging, cause, ob#ect or Possession,
was actually purpose is however,
part of 1e#a contrary to law, remained with
%ar9eting. 1he morals, good the spouses
 I9abit customs, public campo who
systemJ: order or public operated and
<aucian and policy maintained the
1e#a %ar9eting same under
were made to the name
appear as  Acme 1axi.
different ne of said
persons taxicabs
because Pedro collided with a
had no tricycle motorcycle
franchise of whose driver
his own and died from
only attached head
his tricycle to in#uries1wo of
formerDs %; the vehicles of 
+ine. <aucian respondent

,?  of ,- 
 spouses was contends that person upon the damage
levied upon to recogni8e whom caused to his
and sold at an operator responsibility vehicle. n +im,
public auction. under the may be fixed in evil does not exist
1hereafter, 9a#i!  system case of an because:
/icasio as the real accident with the . 1he case arose
campo party6in6 end view of from the
decided to interest is protecting the negligence of
register his utterly riding public. another vehicle to
taxicabs in his subversive of whom no
name. ;e public policy. representation, or
reCuested the misrepresentation,
manager of as regards the
petitioner +ita ownership and
&nterprises, operation of the
nc. to turn passenger
over the  #eepney was
registration made.
papers to him, 5. 1he riding
but the latter public was not
refused. bothered nor
+im v. A on8ales / a new ne of the +im v. ourt of inconvenienced at
purchased a owner of a primary factors  Appeals is an the very least by
passenger  #eepney considered in the important case the illegal
 #eepney from operating granting of a because it shows arrangement.
 allarta, who under the P is the that a 9abit has
was the holder old ownerDs financial capacity rights too 1he "aliwag 1wo ssuance of 1he NFabit
of a P. certificate of the holder of thrust of the law 1ransit nc. passenger bus one !!! B !ystemN has
on8ales of public the license, so in en#oining the v A lines with is not been defined as
continued convenience that liabilities 9abit system is similar buses determinant an arrangement
operating the (or 9abit arising from not so much as to and similar of whether Nwhereby a
 #eep but did system) accidents may be penali8e the routes were or not the person who has
not transfer may sue for duly parties but to being 9abit been granted a
the damages compensated. identify the operated by system was certificate of
registration to against an 1he registered person upon firm names engaged in. convenience
his name. <eep opposing owner of the whom N"aliwag allows another
collided with a party who vehicle is not responsibility may 1ransitM and person who
truc9 owned caused the allowed to prove be fixed in case of  N"aliwag owns motor
by +im. +im vehicular that another an accident with 1ransit, nc.N vehicles to
alleges that accident* person has the end view of ("1). operate under
on8ales is  Ges become the protecting the %artine8, such franchise
not a real owner so that he riding public. claiming to be for a fee.N 1he
party6in6 may be thereby 1;'!, if the an employee determining
interest since relieved of danger sought to of both bus factor is the
the vehicle responsibility.1he be en#oined does lines with one possession of a
was registered thrust of the law not exist, a 9abit B /umber, franchise to
in anotherDs in en#oining the has the right to filed a petition operate which
name. 1he 9abit  system is proceed against a with the !ocial negates the
petitioner to identify the third person for !ecurity existence of the

,  of ,- 
 ommision to NFabit !ystemN concession to inspect negligent accommodation you invite
compel "1 to and not the the latterDs logs. ;e and not passengers (i.e. someone to
remit to the issuance of one contracted malaria. liable for passengers ride with you
!! his !!! B /umber Bemetrio as9ed damages. whose reCuests because ()
Premium for both bus lines  alencia if he could to ride were not for
contributions from which the hitch a ride with him accommodated compensation
for certiain existence of said to "arrio !amoay, by the driver), or hire, (5) no
years. "1 system was since there was no which may also limited or
denied having inferred other means of be considered general
employed transportation. invited guests clientele
%artine8, "ecause he was within the
saying that he feverish, +ara meaning of the
was employed sat$reclined$crouched law. 1here is no
by 1ua8on in the middle of the difference
who since bac9 part of the pic96 between a
3?7 owned up. alencia invited passenger who
and operated +ara to sit in the front was expressly
buses separate area, but the latter invited to ride
and distinct declined. 1hus, the and a passenger
from "1. seating arrangement who as9ed for a
remained the same as ride T both may
Class No!es: before. 1he pic96up be considered
o t is not per se illegal. t is only contrary to public policy, not law. was travelling on a invited guests.
/evertheless, while you cannot be held criminally liable for it, a really bumpy road .  As such, the
contract in this system remains void. +ara fell from the pic96 level of care
o /ote the different IcontractsJ in the cases under Fabit !ystem. up and suffered reCuired of
1hey varySlease, resale, straightforward sale, sale in installments serious in#uries.  alencia was
with mortgage, etc. hatever the nature of these supposed only the duty to
contacts, they are void. exercise
o Reason why the 9abit system is contrary to public policy: People reasonable care
need to 9now who to run after. t would be unfair if the public so that they may
cannot rely on official documents that evidence who the actual be transported
franchise holder is. safely to their
o Fabit arrangement v. unregistered sale: f 9abit arrangement, B destination. An
as to the parties and third persons. f unregistered sale, not binding owner of an
against third persons "'1 valid as to the parties  becomes automobile owes
binding as to third persons only upon registration of the sale a guest the duty
to exercise
. Pri'a!e na!ure ri)!s an( o#li)a!ions o0 "ar!ies in!er se arisin) 0ro/ ordinary or
!ransac!ions rela!in) !o !rans"or!a!ion reasonable care
to avoid in#uring
a. a#sen! a !rans"or!a!ion con!rac! him.

Case:
Class No!es:
A!& 2A1! ;&+B B1R/& +A!! /1&! - Absent a transportation contract:
11+&
o bligation of driver: 1he owner or operator of an automobile owes
+ara v. Bemetrio went to  alencia 1he pic96upDs /ot a public
the duty to an invited guest  to exercise reasonable care in its
 alencia  alenciaDs lumber was not passengers were utility when

,  of ,- 
 operation, and not unreasonably to expose him to danger and
in#ury by increasing the ha8ard of travel.
 1here is no difference between a passenger who was
expressly invited to ride and a passenger who as9ed for a
ride T both may be considered invited guests.
o bligation of a passenger: A passenger must observe the diligence
of a good father of a family to avoid in#ury to himself. (/ ->)
ne!2or9s o0 !rans"or!a!ion an( co//unica!ion s$s!e/8 as 2ell as in !e
0as!8 sale8 e00icien! an( relia#le "os!al8 !rans"or!a!ion an( co//unica!ion
ser'ices.
1o accomplish such mandate, the %inistry shall have the following
o#7ec!i'es:
. Pro/o!e !e (e'elo"/en! o0 (e"en(a#le an( coor(ina!e( ne!2or9s
o0 !rans"or!a!ion and communication systemsE

#. lia#ili!$ o0 re)is!ere( o2ner 5. Gui(e )o'ern/en! an( "ri'a!e in'es!/en! in !e (e'elo"/en! o0
!e coun!r$s in!er= /o(el !rans"or!a!ion an( co//unica!ion
Case: s$s!e/s in a most practical, expeditious, and orderly fashion for maximum
A!& 2A1! ;&+B B1R/& +A!! safety, service, and cost effectivenessE
11+& /1&!
0. I/"ose a""ro"ria!e /easure so !a! !ecnical8 econo/ic an( o!er
P  A %itsubishi +ancer s P +easing, 1he registered
con(i!ion 0or !e con!inuin) econo/ic 'ia#ili!$ o0 !e
+easing v. owned by 'P" was as the owner of a vehicle
!rans"or!a!ion an( co//unica!ion en!i!ies are no! 7eo"ar(i+e(  and
'P" insured by the general registered is liable for any
do not encourage inefficiency and distortion of traffic patronageE
eneral insurance branch of owner of a Cuasi delicts that
nsurance 'P" ('P"6).1he truc9 involved may be caused by
+ancer was hit by a in a Cuasi the vehicle, even ?. Bevelop an integrated plan for a nationwide transmission system in
accordance with the national and international telecommunication service
truc9, owned by P delict, liable if a third person
+easing. 1he driver  #ointly and was driving it at reCuirement including, among others,radio and television broadcast relaying,
and the passenger of severally with the time. 1he leased channel services and data transmissionE
the +ancer both its driver who remedy of the
sustained in#uries. 1he is the registered owner 4. uide government and private investment in the establishment, operation
truc9 driver continued employee of its is to file a third and maintenance of an international switching system for incoming and
to his destination and lessee* G&! party complaint outgoing telecommunication servicesE
did not bother to help against the third
>. &ncourage the development of a domestic telecommunication industry in
the victims. 'P"6 person.
coordination with the concern entities particularly, the manufacture of
paid for the insurance
and made repeated communications$ electronics eCuipment and components to complement and
support as much as possible, the expansion, development, operation and
demands towards P
+easing for the maintenance of the nationwide telecommunications networ9E
repayment of the
-. Provide for a safe, reliable and efficient postal system for the country.
amount. P +easingDs
defense was that it
was not liable for the
6 & 54, !ection 4. Powers and 2unctions. 1o accomplish its mandate, the
collision, since the
De"ar!/en! sall a'e !e 0ollo2in) "o2ers an( 0unc!ions :
truc9 driver was not its
employee, but . ;or/ula!e an( reco//en( na!ional "olicies an( )ui(elines 0or !e
"re"ara!ion an( i/"le/en!a!ion o0 in!e)ra!e( an( co/"reensi'e
!'&Ds.
!rans"or!a!ion and communications systems at the na!ional8 re)ional
an( local levelsE
III. Re)ula!ion o0 !e Trans"or!a!ion In(us!r$
,. Te De"ar!/en! o0 Trans"or!a!ion an( Co//unica!ion
5. Es!a#lis an( a(/inis!er co/"reensi'e an( in!e)ra!e( "ro)ra/s
0or !rans"or!a!ion and communications, and for this purpose, may call on
Rele'an! "ro'isionFs:
an$ a)enc$8 cor"ora!ion8 or or)ani+a!ion8 2e!er "u#lic or
& 54, !ection ?. !&1/ ?. %andate. 1he %inistry shall be the "ri/ar$ "olic$8
"ri'a!e8 2ose (e'elo"/en! "ro)ra/s inclu(e !rans"or!a!ion an(
"lannin)8 "ro)ra//in)8 coor(ina!in)8 i/"le/en!in)8 re)ula!in)8 an(
co//unica!ions as an in!e)ral "ar! !ereo08 !o "ar!ici"a!e  and assist
a(/inis!ra!i'e en!i!$ o0 !e E<ecu!i'e Branc o0 !e )o'ern/en! in !e
in the preparation and implementation of such programE
"ro/o!ion8 (e'elo"/en! an( re)ula!ion o0 (e"en(a#le an( coor(ina!e(
,  of ,- 
0.  Assess8 re'ie2 an( "ro'i(e (irec!ion !o !rans"or!a!ion an(
co//unica!ion researc an( (e'elo"/en!  programs of the
government in coordination with other institutions concernedE
?.  A(/inis!er an( en0orce all la2s8 rules an( re)ula!ions in !e 0iel(
o0 !rans"or!a!ion and communicationsE
4. Coor(ina!e 2i! !e De"ar!/en! o0 Pu#lic Wor9s an( Hi)2a$s in
!e (esi)n8 loca!ion8 (e'elo"/en!8 rea#ili!a!ion8 i/"ro'e/en!8
cons!ruc!ion8 /ain!enance an( re"air o0 all in0ras!ruc!ure " ro7ec!s
an( 0acili!ies  of the Bepartment. ;owever, government corporate entities
attached to the Bepartment shall be authori8ed to underta9e speciali8ed
telecommunications, ports, airports and railways pro#ects and facilities as
directed by the President of the Philippines or as provided by lawE
>. &stablish, operate and maintain a nationwide postal system that shall
include mail processing, delivery services, and money order services and
promote the art of philatelyE
-. Issue cer!i0ica!es o0 "u#lic con'enience 0or !e o"era!ion o0 "u#lic
lan( an( rail !rans"or!a!ion  utilities and servicesE
7.  Accre(i! 0orei)n aircra0! /anu0ac!urers an(For in!erna!ional
or)ani+a!ions 0or aircra0! cer!i0ica!ion in accordance with established
procedures and standardsE
3. Es!a#lis an( "rescri#e rules an( re)ula!ions 0or i(en!i0ica!ion o0
rou!es8 +ones an(For areas o0 o"era!ions o0 "ar!icular o"era!ors o0
"u#lic lan( ser'ices E
@. &stablish and prescribe rules and regulations for the establishment,
operation and maintenance of such telecommunications facilities in areas
not adeCuately served by the private sector in order to render such domestic
and overseas services that are necessary with due consideration for
advances in technologyE
. &stablish and prescribe rules and regulations for the operation and
maintenance of a nationwide postal system that shall include mail
processing, delivery services, money order services and promotion of
philatelyE
5. Es!a#lis an( "rescri#e rules an( re)ula!ions 0or issuance o0
cer!i0ica!es o0 "u#lic con'enience 0or "u#lic lan( !rans"or!a!ion
u!ili!ies, such as motor vehicles, trimobiles and railwaysE
0. Es!a#lis an( "rescri#e rules an( re)ula!ions 0or !e ins"ec!ion an(
re)is!ra!ion o0 air an( lan( !rans"or!a!ion 0acili!ies , such as motor
vehicles, trimobiles, railways and aircraftsE
?. Es!a#lis an( "rescri#e rules an( re)ula!ions 0or !e issuance o0
licenses !o &uali0ie( /o!or 'eicle (ri'ers , conductors, and airmenE
4. Es!a#lis an( "rescri#e !e corres"on(in) rules an( re)ula!ions 0or
!e en0orce/en! o0 la2s )o'ernin) lan( !rans"or!a!ion8 air
!rans"or!a!ion and postal services, inclu(in) !e "enal!ies  for
violations thereof, and for the deputation of appropriate law enforcement
agencies in pursuance thereofE
>. De!er/ine8 0i< an(For "rescri#e car)es an(For ra!es "er!inen! !o
!e o"era!ion o0 "u#lic air an( lan( !rans"or!a!ion  utility facilities and
services, e<ce"! suc ra!es an(For car)es as /a$ #e "rescri#e( #$
!e Ci'il Aeronau!ics Boar( un(er i!s car!er8 an(8 in cases 2ere
car)es or ra!es are es!a#lise( #$ in!erna!ional #o(ies or
associa!ions o0 2ic !e Pili""ines is a "ar!ici"a!in) /e/#er or
#$ #o(ies or associa!ions reco)ni+e( #$ !e Pili""ine )o'ern/en!
as !e "ro"er ar#i!er of such charges or ratesE
-. Es!a#lis an( "rescri#e !e rules8 re)ula!ions8 "roce(ures an(
s!an(ar(s 0or !e accre(i!a!ion o0 (ri'in) scools E
7.  A(/inis!er an( o"era!e !e Ci'il A'ia!ion Trainin) Cen!er 5CATC6
an( !e Na!ional Teleco//unica!ions Trainin) Ins!i!u!e 5NTTI6 E
and
3. Perform such o!er "o2ers an( 0unc!ions as /a$ #e "rescri#e( #$
la28 or as /a$ #e necessar$8 inci(en!al8 or "ro"er !o i!s /an(a!e or
as /a$ #e assi)ne( 0ro/ !i/e !o !i/e #$ !e Presi(en! of the
Republic of the Philippines.
& 535, "oo9 , 1itle L.
CHAPTER ,
General Pro'isions
SECTION ,. Declara!ion o0 Polic$ .S1he S!a!e is co//i!!e( !o !e
/ain!enance an( e<"ansion o0 'ia#le8 e00icien!8 0as!8 sa0e an( (e"en(a#le
!rans"or!a!ion and communications systems as e00ec!i'e ins!ru/en!s 0or
na!ional reco'er$ an( econo/ic "ro)ress . I! sall no! co/"e!e as a /a!!er
o0 "olic$ 2i! "ri'a!e en!er"rise an( sall o"era!e !rans"or!a!ion an(
co//unica!ions 0acili!ies onl$ in !ose areas 2ere "ri'a!e ini!ia!i'es are
ina(e&ua!e or non=e<is!en! .
SECTION 4. *an(a!e.1he De"ar!/en! o0 Trans"or!a!ion an(
Co//unica!ions sall #e !e "ri/ar$ "olic$8 "lannin)8 "ro)ra//in)8
coor(ina!in)8 i/"le/en!in)8 re)ula!in) an( a(/inis!ra!i'e en!i!$ o0 !e
E<ecu!i'e Branc o0 !e )o'ern/en! in !e "ro/o!ion8 (e'elo"/en! an(
re)ula!ion o0 (e"en(a#le an( coor(ina!e( ne!2or9s o0 !rans"or!a!ion  and
communications systems as well as in the fast, safe, efficient and reliable postal,
transportation and communications services.
4-  of ,- 
SECTION . Po2ers an( ;unc!ions .S1o accomplish its mandate, the Bepartment
shall:
() ;or/ula!e an( reco//en( na!ional "olicies an( )ui(elines 0or !e
"re"ara!ion an( i/"le/en!a!ion o0 in!e)ra!e( an( co/"reensi'e
!rans"or!a!ion and communications systems at the na!ional8 re)ional an( local
le'els E
(5) Es!a#lis an( a(/inis!er co/"reensi'e an( in!e)ra!e( "ro)ra/s 0or
!rans"or!a!ion an( co//unica!ions, and for this purpose, it may call on an$
a)enc$8 cor"ora!ion or or)ani+a!ion8 2e!er "u#lic or "ri'a!e8 2ose
(e'elo"/en! "ro)ra/s inclu(e !rans"or!a!ion an( co//unica!ions as
in!e)ral "ar!s !ereo08 !o "ar!ici"a!e an( assis!  in the preparation and
implementation of such programsE
(0) Assess8 re'ie2 an( "ro'i(e (irec!ion !o !rans"or!a!ion an(
co//unica!ions researc an( (e'elo"/en! "ro)ra/s o0 !e )o'ern/en! in
coordination with other institutions concernedE
(?) A(/inis!er an( en0orce all la2s8 rules an( re)ula!ions  in the field of
transportation and communicationsE
(4) Coor(ina!e 2i! !e De"ar!/en! o0 Pu#lic Wor9s an( Hi)2a$s in !e
(esi)n8 loca!ion8 (e'elo"/en!8 rea#ili!a!ion8 i/"ro'e/en!8 cons!ruc!ion8
/ain!enance an( re"air o0 all in0ras!ruc!ure "ro7ec!s an( 0acili!ies o0 !e
De"ar!/en!. ;owever, government corporate entities attached to the Bepartment
shall be authori8ed to underta9e speciali8ed telecommunications, ports, airports and
railways pro#ects and facilities as directed by the President of the Philippines or as
provided by lawE
(>) &stablish, operate and maintain a nationwide postal system that shall include mail
processing, delivery services and money order services and promote the art of
philatelyE
(-) Issue cer!i0ica!es o0 "u#lic con'enience 0or !e o"era!ion o0 "u#lic lan(
an( rail !rans"or!a!ion u!ili!ies  and servicesE
(7) Accre(i! 0orei)n aircra0! /anu0ac!urers or in!erna!ional or)ani+a!ions
0or aircra0! cer!i0ica!ion  in accordance with established procedures and standardsE
(3) Es!a#lis an( "rescri#e rules an( re)ula!ions 0or i(en!i0ica!ion o0 rou!es8
+ones or areas o0 o" era!ion o0 "ar!icular o"era!ors o0 "u#lic lan( s er'ices E
(@) &stablish and prescribe rules and regulations for the establishment, operation
and maintenance of such telecommunications facilities in areas not adeCuately served
by the private sector in order to render such domestic and overseas services that are
necessary with due consideration for advances in technologyE
() Es!a#lis an( "rescri#e rules an( re)ula!ions 0or !e issuance o0
cer!i0ica!es o0 "u#lic con'enience 0or "u#lic lan( !rans"or!a!ion u!ili!ies ,
such as motor vehicles, trimobiles and railwaysE
(5) Es!a#lis an( "rescri#e rules an( re)ula!ions 0or !e ins"ec!ion an(
re)is!ra!ion o0 air an( lan( !rans"or!a!ion 0acili!ies , such as motor vehicles,
trimobiles, railways and aircraftE
(0) Es!a#lis an( "rescri#e rules an( re)ula!ions 0or !e issuance o0
licenses !o &uali0ie( /o!or 'eicle (ri'ers , conductors and airmenE
(?) &stablish and prescribe the corresponding rules and regulations for enforcement
of laws governing land transportation, air transportation and postal services, including
the penalties for violations thereof, and for t he deputation of appropriate law
enforcement agencies in pursuance thereofE
(46 De!er/ine8 0i< or "rescri#e car)es or ra!es "er!inen! !o "os!al
ser'ices an( !o !e o"era!ion o0 "u#lic air an( lan( !rans"or!a!ion  utility
facilities and services, except such rates or charges as may be prescribed by the ivil
 Aeronautics "oard under its charter and, in cases where charges or rates are
established by international bodies or associations of which the Philippines is a
participating member or by bodies or associations recogni8ed by the Philippine
government as the proper arbiter of such charges or ratesE
(>) Es!a#lis an( "rescri#e !e rules8 re)ula!ions8 "roce(ures an(
s!an(ar(s 0or !e accre(i!a!ion o0 (ri'in) scools E
(-) A(/inis!er an( o"era!e !e Ci'il A'ia!ion Trainin) Cen!er 5CATC6 an(
!e Na!ional Teleco//unica!ions Trainin) Ins!i!u!e 5NTTI6 E and
(7) Perform such o!er "o2ers an( 0unc!ions as /a$ #e "ro'i(e( #$ la2.
SECTION >.  rgani8ational !tructure.S1he De"ar!/en! sall consis! o0 !e
De"ar!/en! Pro"er8 !e De"ar!/en! Re)ional O00ices8 !e Lan(
Trans"or!a!ion ;rancisin) an( Re)ula!or$ Boar(8 an( !e A!!ace(
 A)encies.
Class No!es:
o 1he /;&R&/1 right to regulate transportation belongs to the legislature. t
delegated to B1.
 !till, supposedly, there are some powers still with ongress  ex.
ranting of franchises to carriers as implied by Rep. Act 370 ("'1
thereDs debate about this because A" is supposed to have the right
to grant without needing legislative assent anymore)
o "odies under B1 : AAP, +12R", etc.
 ;ow does B1 control them* Amend, revo9e decisions, rules, etc.
 ne of the '!ecs is ex officio on the board of these
agencies.
a. Air
i. Ci'il A'ia!ion Au!ori!$ o0 !e Pili""ines
Rele'an! "ro'isionFs:
RA 3?3-, !ection ?. Crea!ion o0 !e Au!ori!$.  6 1here is hereby
created an in(e"en(en! re)ula!or$ #o($ 2i! & uasi=7u(icial
an( &uasi=le)isla!i'e "o2ers an( "ossessin) cor"ora!e
a!!ri#u!es !o #e 9no2n as !e Ci'il A'ia!ion Au!ori!$ o0 !e
Pili""ines 5CAAP6 , hereinafter referred to as the NAuthorityN
a!!ace( !o !e De"ar!/en! o0 Trans"or!a!ion an(
Co//unica!ions 5DOTC6 for the purpose of policy coordination.
2or this purpose, the e<is!in) Air Trans"or!a!ion O00ice
crea!e( un(er !e "ro'isions o0 Re"u#lic Ac! No. ?8 as
a/en(e(8 is ere#$ a#olise( .
/otwithstanding the foregoing, no!in) in !is Ac! sall
(i/inis !e "o2ers an( 0unc!ions o0 !e Ci'il Aeronau!ics
Boar( 5CAB6 as provided for under Republic Act. /o. -->, also
9nown as N1he ivil Aeronautics Act of the PhilippinesN, as
amended.
4, of ,- 
(a) Es!a#lis/en! o0 Au!ori!$ Hea(e( #$ a Direc!or
General 6 1he  Au!ori!$ sall #eea(e( #$ a Direc!or
General o0 Ci'il A'ia!ion , referred to in this Act as the NBirector
eneral,N who shall be a""oin!e( #$ !e Presi(en! o0 !e
Pili""ines an( sall #e res"onsi#le 0or all ci'il a'ia!ion in
!e Pili""ines an( !e a(/inis!ra!ion o0 !is Ac! . 1he
Birector eneral shall be appointed based on the Cualifications
herein provided and shall have a !enure o0 o00ice 0or a "erio( o0  conditions and limitations as the Birector eneral may determine to
0our 5>6 $ears. ;is a""oin!/en! /a$ #e e<!en(e( 0or
ano!er non=e<!en(i#le !er/ o0 0our 5>6 $ears an( sall
onl$ #e re/o'e( 0or cause  in accordance with the rules and
regulations prescribed by the ivil !ervice ommission.
(b) Res"onsi#ili!$ o0 !e Direc!or General  6 1he Direc!or
General sall #e res"onsi#le 0or !e e<ercise o0 all "o2ers
an( !e (iscar)e o0 all (u!ies o0 !e Au!ori!$  and shall
have control over all personnel and activities of the Authority.
RA 3?3-, !ection 5. Policies. 6 In !e e<ercise an(
"er0or/ance o0 i!s "o2ers an( (u!ies un(er !is Ac!8 !e
 Au!ori!$ sall consi(er !e 0ollo2in) , among other things, as
#ein) in !e "u#lic in!eres! an( in accor(ance 2i! !e
"u#lic con'enience an( necessi!$ :
(a) 1he (e'elo"/en! an( u!ili+a!ion o0 !e air "o!en!ial  of
the PhilippinesE
(b) Te encoura)e/en! an( (e'elo"/en! o0 an air
!rans"or!a!ion s$s!e/ "ro"erl$ a(a"!e( !o !e "resen! an(
0u!ure o0 0orei)n an( (o/es!ic co//erce  of the PhilippinesE
(c) 1he re)ula!ion o0 air !rans"or!a!ion in suc /anner as !o
su""or! soun( econo/ic con(i!ion in suc !rans"or!a!ion
an( !o i/"ro'e !e r ela!ions #e!2een air carriers E
(d) Ensurin) !e sa0e!$8 &uali!$8 relia#ili!$8 an( a00or(a#ili!$
o0 air !rans"or! ser'ices  for the riding publicE and
(e) Te encoura)e/en! an( (e'elo"/en! o0 a 'ia#le an(
)lo#all$ co/"e!i!i'e Pili""ine a'ia!ion in(us!r$ .
RA 3?3-, !ection 04. Po2ers an( ;unc!ions o0 !e Direc!or
General. 6 1he Direc!or General sall #e !e cie0 e<ecu!i'e
an( o"era!in) o00icer o0 !e Au!ori!$ . ;e shall have the
following "o2ers8 (u!ies an( res"onsi#ili!ies :
(a) 1o carr$ ou! !e "ur"oses an( "olicies es!a#lise( in
!is Ac!E to en0orce !e "ro'isions o0 !e rules an(
re)ula!ions issue( in pursuance to said ActE and he shall
primarily be 'es!e( 2i! au!ori!$ !o !a9e car)e o0 !e
!ecnical an( o"era!ional "ase o0 ci'il a'ia!ion /a!!ers E
(b) 1o (esi)na!e an( es!a#lis ci'il air2a$s , to ac&uire8
con!rol8 o"era!e an( /ain!ain alon) suc air2a$s8
na'i)a!ion 0acili!ies  and to car! suc air2a$s an( arran)e
0or !eir "u#lica!ion inclu(in) !e aeronau!ical car!s or
/a"s re&uire( #$ !e in!erna!ional aeronau!ical a)encies ,
by utili8ing the eCuipment, supplies or assistance of existing
agencies of the government as far as practicableE
(c) 1o issue air/ans cer!i0ica!e  specifying the capacity in which
the holder thereof is authori8ed to serve as airman in connection
with aircraft and shall be issued only upon the finding that the
applicant is properly Cualified and physically able to perform the
duties of the position. 1he certificate shall contain such terms,
be necessary to assure safety in air commerce: Pro'i(e(8
o2e'er8 Ta! !e air/ans license sall #e issue( onl$ !o
&uali0ie( "ersons 2o are ci!i+ens o0 !e Pili""ines or
&uali0ie( ci!i+ens o0 coun!ries )ran!in) si/ilar ri)!s an(
"ri'ile)es !o ci!i+ens o0 !e Pili""ines E
(d) 1o issue air2or!iness cer!i0ica!e 0or aircra0!  which shall
prescribe the duration of such certificate, the type of service for
which the aircraft may be used, and such other terms and
conditions and limitations as are reCuiredE
(e) 1o issue air carrier o"era!in) cer!i0ica!e  in accordance with
the minimum safety standards for the operation of the air carrier to
whom such certificate is issued. 1he air carrier operating certificate
shall be issued only to aircrafts registered under the provisions of
this ActE
(f) 1o issue !$"e cer!i0ica!e 0or aircra0!8 aircra0! en)ine8
"ro"ellers an( a""liances E
(g) 1o ins"ec!8 classi0$ an( ra!e an$ air na'i)a!ion 0acili!ies
an( aero(ro/es a'aila#le 0or !e use o0 aircra0!  as to its
suitability for such use and to issue a certificate for such air
navigation facility and aerodromeE and to determine the suitability
of foreign aerodromes, air navigation facilities as well as air routes
to be used prior to the operation of Philippine6registered aircraft in
foreign air transportation and from time to time thereafter as may
be reCuired in the interest of safety in air commerceE
(h) 1o issue cer!i0ica!es o0 "ersons or ci'il a'ia!ion scools
)i'in) ins!ruc!ion in 0l$in)8 re"air s!a!ions8 an( o!er air
a)encies an( "ro'i(e 0or !e e<a/ina!ion an( r a!in)
!ereo0 E
(i) 1o "ro'i(e 0or !e en0orce/en! o0 !e rules an(
re)ula!ions issue( un(er !e "ro'isions o0 !is Ac! an( !o
con(uc! in'es!i)a!ion 0or 'iola!ions thereto. n underta9ing
such investigation, to reCuire by subpoena ad testificandum or
subpoena duces tecum, the attendance and testimony of
witnesses, the production of boo9s, papers, documents, exhibits
matter, evidence, or the ta9ing of depositions before any person
authori8ed to administer oath. Refusal to submit the reasonable
reCuirements of the investigation committee shall be punishable in
accordance with the provisions of this ActE
(#) 1o collec! an( (isse/ina!e in0or/a!ion rela!i'e !o ci'il
aeronau!ics an( !e (e'elo"/en! o0 air co//erce an( !e
aeronau!ical in(us!r$ E to e<can)e 2i! 0orei)n
44  of ,- 
 )o'ern/en!s8 in0or/a!ion "er!ainin) !o ci'il aeronau!ics E
and to "ro'i(e 0or (irec! co//unica!ion on all /a!!ers
rela!in) !o !e !ecnical or o"era!ional "ase o0
aeronau!ics 2i! in!erna!ional aeronau!ical a)encies :
(9) 1o ac&uire an( o"era!e suc aircra0! as /a$ #e
necessar$ !o e<ecu!e !e (u!ies an( 0unc!ions o0 !e
 Au!ori!$ prescribed in this ActE
(l) 1o "lan8 (esi)n8 ac&uire8 es!a#lis8 cons!ruc!8 o"era!e8
i/"ro'e8 /ain!ain8 an( re"air necessar$ aero(ro/es an(
o!er air na'i)a!ion 0acili!ies E
(m) 1o collec! an( recei'e car)es an( 0ees 0or !e
re)is!ra!ion o0 aircra0! an( 0or !e issuance an(For rene2al
o0 licenses or cer!i0ica!es  for aircraft, aircraft engines, propellers
and appliances, and airmen as provided in this ActE
(n) To i/"ose 0ines an(For ci'il "enal!ies  in respect theretoE
(o) 1o "ar!ici"a!e ac!i'el$ 2i! !e lar)es! "ossi#le (e)ree
in !e (e'elo"/en! o0 in!erna!ional s!an(ar(i+a!ion o0
"rac!ices in a'ia!ion /a!!ers  important to safe, expeditious,
and easy navigation, and to implement as far as practicable the
international standards, reco//en(e( "rac!ices an( "olicies
a(o"!e( #$ a""ro"ria!e in!erna!ional aeronau!ical
a)enciesE
(p) 1o e<ercise an( "er0or/ i!s "o2ers an( (u!ies un(er
!is Ac! consis!en! 2i! an$ o#li)a!ion assu/e( #$ !e
Re"u#lic o0 !e Pili""ines in an$ !rea!$8 con'en!ion or
a)ree/en! on civil aviation mattersE
(C) 1o coo"era!e8 assis! an( coor(ina!e 2i! an$ researc
an( !ecnical a)enc$ o0 !e )o'ern/en! on /a!!ers
rela!in) !o researc an( !ecnical s!u( ies on design,
materials, wor9manship, construction, performance, maintenance
and operation of aircraft, aircraft engines, propellers, appliances,
and air navigation facilities including aircraft fuel and oil: Provided,
1hat nothing in this Act shall be construed to authori8e the
duplication of the laboratory research, activities or technical studies
of any existing governmental agencyE
(r) 1o (esi)na!e suc "roi#i!e( an( (an)er areas8 in
consonance 2i! !e re&uire/en!s o0 !e in!erna!ional
aeronau!ical a)encies an( na!ional securi!$ E
(s) 1o issue8 (en$8 sus"en(8 cancel or re'o9e an$ cer!i0ica!e8
license "er!ainin) !o aircra0!8 air/en an( air a)encies :
Provided, 1hat any order denying, suspending, cancelling, revo9ing
the certificate or license may he appealed to the "oard, whose
decisions shall he final within fifteen (4) days from the date of
notification of such denial, cancellation or revocationE
(t) 1o )ran! au!ori+a!ion !o ci'il aircra0! or "ersons !o carr$
ins!ru/en!s or "o!o)ra"ic (e'ices !o #e use( 0or aerial
"o!o)ra"$ or !a9in) o0 "ic!ures #$ "o!o)ra" or
s9e!cin) o0 an$ "ar! o0 !e Pili""ines E and
(u) Pursuant to a board resolution, to en!er in!o8 /a9e an(
e<ecu!e con!rac!s o0 an$ 9in( 2i! an$ "erson8 0ir/8 or
"u#lic or "ri'a!e cor"ora!ion .
ii. Ci'il Aeronau!ics Boar(
Rele'an! "ro'isions:
RA -->, !ection 4. Co/"osi!ion o0 !e Boar(. 6 1he Ci'il
 Aeronau!ics Boar( sall #e co/"ose( o0 !e Secre!ar$ o0
Trans"or!a!ion an( Co//unica!ions or is (esi)na!e(
re"resen!a!i'e as Cair/an8 !e Assis!an! Secre!ar$ 0or Air
Trans"or!a= !ion o0 !e De"ar!/en! o0 Trans"or!a!ion an(
Co//unica!ions as Vice=Cair/an8 !e Co//an(in)
General o0 !e Pili""ine Air ;orce1 an( !2o 546 /e/#ers
!o #e a""oin!e( #$ !e Presi(en! o0 !e Pili""ines . 1hey
shall hold office at the pleasure of the President.
No /e/#er o0 !e Boar( sall a'e an$ "ecuniar$ in!eres!
in8 or o2n an$ s!oc9 or #on( o08 an$ ci'il aeronau!ics
en!er"rise.
RA -->, !ection @ . Po2ers an( (u!ies o0 !e Boar(. 6 (A)
&xcept as otherwise provided herein, the Boar( sall a'e !e
"o2er !o re)ula!e !e econo/ic as"ec! o0 air
!rans"or!a!ion8 an( sall a'e !e )eneral su" er'ision an(
re)ula!ion o08 !e 7uris(ic!ion an( con!rol o'er8 air carriers8
)eneral sales a)en!s8 car)o sales a)en!s8 an( air0rei)!
0or2ar(ers as 2ell as !eir "ro"er!$8 "ro"er!$ ri)!s8
e&ui"/en!8 0acili!ies8 an( 0rancise , in so far as may be
necessary for the purpose of carrying out the provisions of this Act.
(") 1he "oard may  "er0or/ suc ac!s8 con(uc! suc
in'es!i)a!ions8 issue an( a/en( suc or(ers8 an( /a9e an(
a/en( suc )eneral an( s"ecial rules8 re)ula!ions8 an(
"roce(ures as i! sall (ee/ necessar$  to carry out the
provisions of this Act.
() 1he "oard shall have the 0ollo2in) s"eci0ic "o2ers an(
(u!ies:
() n accordance with the provisions of hapter ? of this Act, to
issue8 (en$8 a/en(8 re'ise8 al!er8 /o(i0$8 cancel8 sus"en(8
or re'o9e8 in 2ole or in "ar!8 u"on "e!i!ion or co/"lain!8
or u"on i!s o2n ini!ia!i'e8 an$ !e/"orar$ o"era!in) "er/i!
or Cer!i0ica!e o0 Pu#lic Con'enience an( Necessi!$ E Provided,
however, 1hat in the case of foreign air carriers, the permit shall be
issued with the approval of the President of the Republic of the
Philippines.
(5) 1o 0i< an( (e!er/ine reasona#le in(i'i(ual8 7oin! or
s"ecial ra!es8 car)es or 0ares8 2ic an air carrier /a$
(e/an(8 collec! or recei'e 0or an$ ser'ice in connec!ion
2i! air co//erce . 1he "oard may a(o"! an$ ori)inal8
a/en(e(8 or ne2 in(i'i(ual8 7oin! or s"ecial ra!es8 car)es
4:  of ,- 
 or 0ares "ro"ose( #$ an air carrier  if the proposed individual,
 #oint, or special rates, charges for fares are not unduly preferential
or unduly discriminatory or unreasonable. 1he burden of proof to
show that the proposed individual, #oint or special rates, charges or
fares are #ust and reasonable shall be upon the air carrier
proposing the same.
In 0i<in) ra!es8 car)es8 0ares un(er !e "ro'isions o0 !is
 Ac!8 !e Boar( sall !a9e in!o consi(era!ion8 a/on) o!er
0ac!ors:
(a) 1he e00ec! o0 suc ra!es u"on !e /o'e/en! o0 !ra00ic E
(b) 1he nee( in !e "u#lic in!eres! o0 a(e&ua!e an( e00icien! !rans"or!a!ion
o0 "ersons an( "ro"er!$ #$ air carriers a! !e lo2es! cos! consis!en! 2i!
!e 0urnisin) o0 suc ser'ice .
(c6 Suc s!an(ar(s res"ec!in) !e carac!er an( &uali!$ o0 ser'ice !o #e
ren(ere( #$ air carriers as /a$ #e "rescri#e( #$ or "ursuan! !o la2 E
(d) 1he ineren! a('an!a)es o0 !rans"or!a!ion #$ aircra0! E and
(e) 1he nee( o0 eac air carrier 0or re'enues su00icien! !o ena#le suc air
carrier8 un(er ones!8 econo/ical8 an( e00icien! /ana)e/en!8 !o "ro'i(e
a(e&ua!e an( e00icien! air carrier ser'ice .
(0) 1o au!ori+e an$ !$"e o0 car!ers 2e!er (o/es!ic or
in!erna!ional an( s"ecial air ser'ices or 0li)!  under such
terms and conditions as in its #udgment public interest reCuires.
/otwithstanding the existence of bilateral air agreement, the A" is
authori8ed to )ran! an$ 0orei)n airline increase in
0re&uencies an(For ca"aci!ies on in!erna!ional rou!es 2en
in i!s 7u()/en! !e na!ional in!eres! re&uires i t, provided
that the utili8ation of the increase freCuencies and capacities is not
more than thirty days. All grants of f reCuencies and$or capacities
shall be sub#ect to the approval of the President.
(?) 1o a""ro'e or (isa""ro'e increase an(For (ecrease o0
ca"i!al8 lease8 "urcase8 sales o0 aircra0! o0 air carrier
en)a)e( in air co//erce consoli(a!ion8 /er)er8 "urcase8
lease an( ac&uisi!ion an( con!rol o0 o"era!in) con!rac!s
#e!2een (o/es!ic 0orei)n air carriers8 or #e!2een
(o/es!ic air carriers or an$ "erson en)a)e( in an$ "ase o0  interest.
aeronau!ics.
(4) 1o in&uire in!o !e /ana)e/en! o0 !e #usiness o0 an$
air carrier  and, to the extent reasonably necessary for such
inCuiry, to o#!ain 0ro/ suc carrier8 an( 0ro/ an$ "erson
con!rollin)8 or con!rolle( #$8 or un(er co//on con!rol
2i!8 suc air carrier8 0ull an( co/"le!e re"or!s  and other
informations. !uch reports shall be under oath whenever the "oard
so reCuires.
(>) 1o re&uire annual8 /on!l$8 "erio(ical8 an( s"ecial
re"or!s 0ro/ an$ air carrier8 !o "rescri#e !e /anner an(
0or/ in 2ic suc re"or!s sall #e /a(e8 an( !o re= &uire
0ro/ an$ air carrier s"eci0ic ans2ers !o all &ues!ions u"on
2ic !e Boar( /a$ (ee/ in0or/a!ion !o #e necessar$ .
!uch reports shall be under oath whenever the "oard so reCuires.
1he "oard may also reCuire any air carrier to f ile with it any
contract, agreement, understanding or arrangement, or a true copy
thereof, between such air carrier and any other carrier or person, in
relation to any traffic affected by the provisions of this Act.
(-) 1o "rescri#e !e 0or/s o0 an$ an( all accoun!s8 recor(s8
an( /e/oran(a o0 !e /o'e/en! o0 !ra00ic8 as 2ell as o0
!e recei"!s an( e<"en(i!ures o0 /one$8 an( !e len)! o0
!i/es suc accoun!s8 recor(s an( /e/oran(a sall #e
"reser'e(: Provided, that any air carrier may 9eep additional
accounts, records, or memoranda if they do not impair the integrity
of the accounts, records, or memoranda prescribed or approved by
the "oard and do not constitute an undue financial burden on such
air carrier.
(7) 1o re&uire eac o00icer an( (irec!or o0 an$ air carrier !o
!rans/i! a re"or! (escri#in) !e sares o0 s!oc9 2i! an$
"ersons en)a)e( in an$ "ase or o!er in!eres! el( #$
suc air carrier o0 aeronau!ics8 an( !e ol(in) o0 !e s!oc9
in an( con!rol o08 o!er "ersons en)a)e( in an$ "ase o0
aeronau!ics.
RA -->, !ection . Na!ure8 !er/s an( con(i!ions. 6
Cer!i0ica!e o0 Pu#lic Con'enience an( Necessi!$ is a "er/i!
issue( #$ !e Boar( au!ori+in) a "erson !o en)a)e in air
co//erce an(For !rans"or!a!ion8 0orei)n an(For (o/es!ic .
No "erson sall en)a)e in air co//erce unless !ere is in
0orce a "er/i! issue( #$ !e Boar(.
/o general sales agent, cargo sales agent or airfreight forwarder
shall engage in any of the activities mentioned in !ection 0
paragraphs (##), (99) and (ll) respectively, unless there is in force a
permit or any other form of authori8ation issued by the "oard.
 An$ "er/i! /a$ #e al!ere(8 a/en(e(8 /o(i0ie(8 sus"en(e(8
cancele( or re'o9e( #$ !e Boar( in 2ole or in "ar! , upon
complaints or petition or upon the "oardMs initiative as hereinafter
provided, whenever the "oard finds such action to be in the public
Tere sall #e a!!ace( !o !e e<ercise o0 !e "ri'ile)es
)ran!e( #$ !e "er/i!8 or a/en(/en! !ere!o8 suc
reasona#le !er/s8 con(i!ions8 or li/i!a!ions  as, in the
 #udgment of the "oard, the public interest may reCuire.
No "er/i! sall con0er an$ "ro"rie!ar$8 "ro"er!$8 or
e<clusi'e ri)! in !e use o0 an$ air s"ace8 ci'il air2a$8
lan(in) area o0 )o'ern/en! air na'i)a!ion 0acili!$ .
Te "er/i! sall8 a/on) o!ers s"eci0$ !e !er/inal an(
in!er/e(ia!e "oin!s8 i0 an$8 #e!2een 2ic !e air carrier is
au!ori+e( !o o"era!e !e ser'ice !o #e ren(ere(8 !e !i/e
o0 arri'al an( (e"ar!ure a! eac "oin!8 an( !e 0re&uenc$ o0 
0li)!s. Provided, that no change in routes, rates, schedules or
freCuency nor supplemental or additional flights to those covered
by an air commerce permit or franchise shall be affected without
4>  of ,- 
 prior approval of the ivil Aeronautics "oard. n so far as the operation of 
operation is to ta9e place within the Philippines, the permit shall domestic
designate the terminal and intermediate points only insofar as the transport
"oard shall deem practicable, and otherwise shall designate only services,
the general route or routes to be followed. has
No carrier sall a#an(on an$ rou!e8 or "ar! !ereo0 0or delegated
2ic a "er/i! as #een issue(8 unless u"on 0in(in)s #$ to the said
!e Ci'il Aeronau!ics Boar( !a! suc an a#an(on/en! is body the
unecono/ical an( is in !e "u#lic in!eres!. authority to
determine
RA -->, !ection 5. Ci!i+ensi" re&uire/en!. 6 E<ce"! as the
o!er2ise "ro'i(e(8 in !e Cons!i!u!ion an( e<is!in) !rea!$ capability
or !rea!ies8 "er/i! au!ori+in) a "erson !o en)a)e in and
(o/es!ic air co//erce an(For !rans"or!a!ion sall #e competence
issue( onl$ !o ci!i+ens o0 !e Pili""ines. of a
prospective
Cases: domestic air
A!& 2A1! ;&+B B1R/& +A!! transport
/1& operator to
! engage in
PA+ v. randAir applied for a P/ with / A" has such.
A" A". Petitioner opposed ongress, in the Fuwait Fuwait Airways and PA+ entered A" 1he ivil
randAirDs application for enacting RA authority to  Airway into a ommercial Agreement representative  Aeronautics
randAir does not possess a -->, has issue a s v. which essentially authori8es Ds assent "oard has
legislative franchise authori8ing it delegated the P/ to a PA+ Fuwait Airways to board could not bind not duly
to engage in air transportation authority to domestic air passengers in Fuwait and deplane PA+. exercised
service within the Philippines or authori8e the transport them in %anila, as well as to its
elsewhere. !uch franchise is, operation of operator, board passengers in %anila and regulatory
allegedly, a reCuisite for the domestic air who, deplane them in Fuwait. authority
issuance of a P/ by the transport though not Fuwait Airways obligated itself to over a local
respondent "oard, as mandated services to possessing  Ishare with Philippine Airlines airline in
under !ec. , Art. L of the the a legislative revenue earned from the uplift of order to
onstitution. randAir, on the respondent franchise, passengers implement
other hand, posits that a A", such meets all between Fuwait and %anila and or further
legislative franchise is no longer a that the other vice versa.J n 334, delegations government
reCuirement based on !ec, @ of ongressional reCuiremen from air policy.
RA -->, as amended by P.B. ?>5 mandate for ts the Philippine and Fuwait govern hat
the approval prescribed ment signed a onfidential happened
of such by !ection %emorandum of 'nderstanding instead was
authority is no 5. (%'). 1he ;ead of the an officer of 
longer ongress, Belegation and &xecutive Birector the A",
necessary. by giving of the A" signed the %' in acting in
 Ges the behalf of the overnment of the behalf not
respondent Republic of the Philippines. 1he of the
"oard the two delegations agreed that the "oard but
power to unilateral operation and the of the
issue exercise of third and fourth Philippine
permits for freedom traffic rights shall not be government
the sub#ect to any royalty payment or , had

4  of ,- 
 commercial arrangements. committed
to a foreign & 546A, !ection . De"ar!/en! Re)ional O00ices.  1he
nation the De"ar!/en! sall a'e !ree 56 De"ar!/en! Re)ional
immediate O00ices in eac o0 !e a(/inis!ra!i'e re)ions o0 !e coun!r$ :
abrogation the De"ar!/en! Re)ional O00ice 0or lan( Trans"or!a!ion8 !e
of PA+Ds De"ar!/en! Re)ional O00ice 0or T eleco//unica!ions an(
commercial !e De"ar!/en! Re)ional O00ice 0or Pos!al Ser'ices . 1he
agreement present Regional ffices of the +and 1ransportation ommission
with Fuwait are hereby abolished and their functions are transferred to the
 Airways. respective Bepartment Regional ffices for +and 1ransportation.
1he present Regional ffices of the "ureau of 1elecommunications
are hereby abolished and their functions are transferred to the
Class No!es: respective Bepartment Regional ffices for 1elecommunications.
- A" is more in charge of the economic aspects of air travel. 1he present Regional ffices of the "ureau of Posts are hereby
o A" canDt invalidate agreements between private carriers without abolished and their functions are transferred to the corresponding
due process and sufficient grounds. Bepartment Regional ffices for Postal !ervices. Eac
o AAP has #urisdiction over airports t also handles privately6owned De"ar!/en! Re)ional O00ice sall #e ea(e( #$ a
air navigation facilitiesSflying schools, private airplanes, etc. De"ar!/en! Re)ional Direc!or an( assis!e( #$ a
De"ar!/en! Assis!an! Re)ional Direc!or.  1he present Airport
#. Lan( ffices of the "ureau of Air 1ransportation are hereby abolished
i. Lan( Trans"or!a!ion O00ice and their functions are transferred to the Bepartment Airport
ffices. 1he abolition of the herein Regional ffices and the
Rele'an! Pro'isions: transfer of their functions shall be governed by the provisions of
!ection 4 (b) hereof.
& 546A, !ection 3.  Assis!an! Secre!aries an( Ser'ice Cie0s . 1he Bepartment Regional ffices shall essentially be line in
1he Secre!ar$ sall also #e assis!e( #$ ei)! 56 Assis!an! character and shall be responsible for the delivery of all front line
Secre!aries a""oin!e( #$ !e Presi(en! u"on !e services of the Bepartment.
reco//en(a!ion o0 !e Secre!ar$8 eac o0 2o/ sall 2or such purposes, the De"ar!/en! Re)ional O00ices sall
res"ec!i'el$ #e res"onsi#le 0or !e 0ollo2in) 0our 5>6 s!a00 a'e 2i!in !eir res"ec!i'e a(/inis!ra!i'e re)ions8 !e
o00ices co/"ose( o0 ei)! 56 ser'ices an( 0our 5>6 line 0ollo2in) 0unc!ions :
o00ices, and shall report to the respective 'ndersecretaries ,. I/"le/en! la2s8 an( "olicies8 "lans8 "ro)ra/s8 "ro7ec!s8 rules an(
assigned by the !ecretary, which 'ndersecretary shall have control re)ula!ions o0 !e De"ar!/en!
and supervision over said respective services and offices: 4. Pro'i(e e00icien!8 an( e00ec!i'e ser'ice !o !e "eo"le
. ffice of the Assistant !ecretary for Administrative and +egal AffairsE . Coor(ina!e 2i! re)ional o00ices o0 o!er (e"ar!/en!s8 o00ices an(
@ Administrative !ervice, and +egal !ervice a)encies
5. ffice of the Assistant !ecretary for 2inance and omptrollershipE >. Coor(ina!e 2i! local )o'ern/en! uni!s
@ 2inance and %anagement !ervice, and omptrollership !ervice . Per0or/ suc o!er 0unc!ions as /a$ #e "ro'i(e( #$ la2.
0. ffice of the Assistant !ecretary for Planning and Pro#ect BevelopmentE
@ Planning !ervice, and Pro#ect Bevelopment !ervice & 546A, !ection 0(a).  A#oli!ionFTrans0erFConsoli(a!ion :
?. ffice of the Assistant !ecretary for %anagement nformation !ervice and a. 1he Lan( Trans"or!a!ion Co//ission is ere#$
Pro#ect %anagementE a#olise( an( i!s s!a00 0unc!ions are !rans0erre( !o !e
@ %anagement nformation !ervice, and Pro#ect %anagement !ervice ser'ice o00ices o0 !e De"ar!/en! Pro"er an( i!s line
4. ffice of the Assistant !ecretary for +and 1ransportationE 0unc!ions are !rans0erre( !o !e De"ar!/en! Re)ional
>. ffice of the Assistant !ecretary for Postal !ervicesE O00ices 0or Lan( Trans"or!a!ion as provided in !ection 
-. ffice of the Assistant !ecretary for 1elecommunicationsE herein. !uch transfer of functions is su#7ec! !o !e
7. ffice of the Assistant !ecretary for Air 1ransportation. "ro'isions o0 Sec!ion , 5#6 ereo0 . Te &uasi=7u(icial
&ach of the above6named services shall be headed by a service "o2ers an( 0unc!ions o0 !e Co//ission are
chief appointed by the President upon the recommendation of the !rans0erre( !o !e De"ar!/en!. 1he corresponding position
!ecretary.
4?  of ,- 
 structure and staffing pattern shall be approved and prescribed
by the !ecretary pursuant to !ection > hereof.
 Administrative ode of 37-, 1itle L, !ection 3(). +ine ffices.S
1he De"ar!/en! sall a'e !e 0ollo2in) line o00ices:
() Te O00ice o0 !e Assis!an! Secre!ar$ 0or Lan(
Trans"or!a!ionE
ii. Lan( Trans"or!a!ion ;rancisin) an( Re)ula!or$ Boar(  
Rele'an! "ro'isions:
& 5@5, !ection  . Crea!ion o0 !e Lan( Trans"or!a!ion
;rancisin) an( Re)ula!or$ Boar(. Tere is ere#$ crea!e(
in !e De"ar!/en! o0 Tr ans"or!a!ion an( Co//unica!ions8
!e Lan( Trans"or!a!ion ;rancisin) an( Re)ula!or$ Boar(
hereinafter referred to as the N"oardN.
& 5@5, !ection 5. Co/"osi!ion o0 !e Boar(.  1he Boar( sall
#e co/"ose( o0 a Cair/an an( !2o 546 /e/#ers 2i! !e
sa/e ran98 salar$ an( "ri'ile)es o0 an Assis!an! Secre!ar$8
all o0 2o/ sall #e a""oin!e( #$ !e Presi(en! o0 !e
Pili""ines u"on reco//en(a!ion o0 !e Secre!ar$ o0
Trans"or!a!ion an( Co//unica!ions.  ne () member of the
"oard shall be a member of the "ar and shall have engaged in the
practice of law in the Philippines for at least five (4) years, another
a holder of a degree in civil engineering, and the other a holder of
a degree in economics, finance or management both with the same
number of years of experience and practice
& 5@5, !ection ? . Su"er'ision an( Con!rol O'er !e B oar(.
1he Secre!ar$ o0 Trans"or!a!ion an( Co//unica!ions8
!rou) is (ul$ (esi)na!e( Un(ersecre!ar$8 s all e<ercise
a(/inis!ra!i'e su"er'ision an( con!rol o'er !e Lan(  
Trans"or!a!ion ;rancisin) an( Re)ula!or$ Boar(.
& 5@5, !ection 4. Po2ers an( ;unc!ions o0 !e Lan(
Trans"or!a!ion ;rancisin) an( Re)ula!or$ Boar(. 1he "oard
shall have the 0ollo2in) "o2ers an( 0unc!ions :
a. 1o "rescri#e an( re)ula!e rou!es o0 ser'ice8 econo/icall$
'ia#le ca"aci!ies an( +ones or areas o0 o"era!ion o0 "u#lic
lan( !rans"or!a!ion ser'ices  provided by motori8ed vehicles in
accordance with the public land transportation development plans
and programs approved by the Bepartment of 1ransportation and
ommunicationsE
b. 1o issue8 a/en(8 re'ise8 sus"en( or cancel Cer!i0ica!es o0  their areas of operationsE
Pu#lic Con'enience or "er/i!s au!ori+in) !e o"era!ion o0
"u#lic lan( !rans"or!a!ion ser'ices  provided by motori8ed
vehicles, and to prescribe the appropriate terms and conditions
thereforE
c. 1o (e!er/ine8 "rescri#e an( a""ro'e an( "erio(icall$
re'ie2 an( a(7us!8 reasona#le 0ares8 ra!es an( o!er
rela!e( car)es8 rela!i'e !o !e o"era!ion o0 "u#lic lan(
!rans"or!a!ion ser'ices provided by motori8ed vehiclesE
d. 1o issue "reli/inar$ or "er/anen! in7unc!ion8 2e!er
"roi#i!or$ or /an(a!or$8 in all cases in 2ic i! as
7uris(ic!ion, and in which cases the pertinent provisions of the
Rules of ourt shall applyE
e. 1o "unis 0or con!e/"! o0 !e Boar(8 #o! (irec! an(
in(irec!8 in accordance with the pertinent provisions of, and the
penalties prescribed by, the Rules of ourtE
f. 1o issue su#"oena an( su#"oena (uces !ecu/ an(
su//on 2i!nesses !o a""ear in an$ "rocee(in)s o0 !e
Boar(, to administer oaths and affirmationsE
g. 1o con(uc! in'es!i)a!ions an( earin)s o0 co/"lain!s 0or
'iola!ion o0 !e "u#lic ser'ice la2s on lan( ! rans"or!a!ion
an( o0 !e Boar(s rules an( re)ula!ions8 or(ers8 (ecisions
an(For rulin)s an( !o i/"ose 0ines an(For "enal!ies 0or
suc 'iola!ions E
h. 1o re'ie2 /o!u "ro"rio !e (ecisionsFac!ions o0 !e
Re)ional ;rancisin) an( Re)ula!or$ O00ice  herein createdE
i. 1o "ro/ul)a!e rules an( re)ula!ions )o'ernin)
"rocee(in)s #e0ore !e Boar( an( !e Re)ional ;rancisin)
an( Re)ula!or$ O00ice : Provided, 1hat except with respect to
paragraphs d, e, f and g hereof, the rules of procedure and
evidence prevailing in the courts of laws should not be controlling
and it is the spirit and intention of said rules that the "oard and the
Regional 2ranchising and Regulatory ffices shall use every and all
reasonable means to ascertain facts in its case speedily and
ob#ectively and without regard to technicalities of law and
procedures, all in the interest of due processE
#. 1o 0i<8 i/"ose an( collec!8 an( "erio(icall$ re'ie2 an(
a(7us!8 reasona#le 0ees an( o!er rela!e( car)es 0or
ser'ices renderedE
9. 1o 0or/ula!e8 "ro/ul)a!e8 a(/inis!er8 i/"le/en! an(
en0orce rules an( re)ula!ions on lan( !rans"or!a!ion "u#lic
u!ili!ies8 s!an(ar(s o0 /easure/en!s an(For (esi)n8 an(
rules an( re)ula!ions re&uirin) o"era!ors o0 an$ "u#lic lan(
!rans"or!a!ion ser'ice !o e&ui"8 ins!all an( "ro'i(e in !eir
u!ili!ies and in their stations such devices, eCuipment facilities and
operating procedures and techniCues as may promote safety,
protection, comfort and convenience to persons and property in
their charges as well as the safety of persons and property within
l. 1o coor(ina!e an( coo"era!e 2i! o!er )o'ern/en!
a)encies an( en!i!ies concerne( 2i! an$ as"ec! in'ol'in)
4  of ,- 
"u#lic lan( !rans"or!a!ion ser'ices 2i! !e en( in 'ie2 o0
e00ec!in) con!inuin) i/"ro'e/en! o0 suc ser'ices E and
m. 1o "er0or/ suc o!er 0unc!ions an( (u!ies as /a$ #e
"ro'i(e( #$ la28 or as /a$ #e necessar$8 or "ro"er or
inci(en!al !o !e "ur"oses an( o#7ec!i'es o0 !is E<ecu!i'e
rder.
& 5@5, !ection >. Decision o0 !e Boar( E Appeals therefrom
and$or Review thereof. 1he Boar(8 in !e e<ercise o0 i!s
"o2ers an( 0unc!ions8 sall si! an( ren(er i!s (ecisions en
#anc. E'er$ suc (ecision8 or(er8 or resolu!ion o0 !e Boar(
/us! #ear !e concurrence an( si)na!ure o0 a! leas! !2o
546 /e/#ers thereof.
1he decision, order or resolution of the "oard shall be a""eala#le
!o !e Secre!ar$ 2i!in !ir!$ 5-6 (a$s 0ro/ recei"! o0 !e
(ecision: Provided, 1hat !e Secre!ar$ /a$ /o!u "ro"rio
re'ie2 an$ (ecision or ac!ion o0 !e Boar( #e0ore !e sa/e
#eco/es 0inal.
& 5@5, !ection -. Crea!ion o0 Re)ional ;rancisin) an(
Re)ula!or$ O00ices . Tere sall #e a Re)ional ;rancisin)
an( Re)ula!or$ O00ice in eac o0 !e a(/inis!ra!i'e re)ions
o0 !e coun!r$ 2ic sall #e ea(e( #$ a Boar( Re)ional
*ana)er having the ran9, salary and privileges of a Bepartment
 Assistant Regional Birector. 1he Re)ional ;rancisin) an(
Re)ula!or$ O00ices sall ear an( (eci(e uncon!es!e(
a""lica!ionsF"e!i!ions 0or rou!es8 2i!in !eir res"ec!i'e
a(/inis!ra!i'e re)ions : Provided, 1hat a""lica!ionsF"e!i!ions
0or rou!es e<!en(in) !eir res"ec!i'e !erri!orial
 7uris(ic!ions sall #e ear( an( (eci(e( #$ !e Boar(.
 Administrative ode of 37-, !ections 4655.
SECTION ,.  +and 1ransportation 2ranchising and Regulatory
"oard.STe &uasi=7u(icial "o2ers an( 0unc!ions 2i!
res"ec! !o lan( !rans"or!a!ion sall #e e<ercise( !rou)
!e Lan( Trans"or!a!ion an( Re)ula!or$ Boar( , hereinafter  
referred to as the I"oardJ.
SECTION ,?.  omposition of the "oard.S1he "oard shall be
co/"ose( o0 a Cair/an an( !2o 546 /e/#ers 2i! !e
ran98 salar$ an( "ri'ile)es o0 an Assis!an! Secre!ar$8 all o0
2o/ sall #e a""oin!e( #$ !e Presi(en! o0 !e
Pili""ines u"on reco//en(a!ion o0 !e Secre!ar$ o0
Trans"or!a!ion an( Co//unica!ions . ne () member of the
"oard shall be a member of the "ar and shall have been engaged
in the practice of law in the Philippines for at least five (4) years,
another a holder of a degree in civil engineering, and the other a
holder of a degree in economics, finance or management both with
the same number of years of experience and practice.
SECTION ,. E<ecu!i'e Direc!or an( Su""or! S!a00 o0 !e
Boar(.S1he Boar( sall a'e an E<ecu!i'e Direc!or 2o
sall also #e a""oin!e( #$ !e Presi(en! o0 !e Pili""ines
u"on !e reco//en(a!ion o0 !e Secre!ar$ o0
Trans"or!a!ion an( Co//unica!ions . ;e shall have the ran9,
salary and privileges of a Bepartment !ervice hief. ;e shall assist
the "oard in the performance of its powers and functions.
1he "oard shall be supported by the 1echnical &valuation Bivision,
+egal Bivision, %anagement nformation Bivision, Administrative
Bivision and 2inance Bivision.
SECTION ,. Su"er'ision an( Con!rol O'er !e Boar( .S1he
Secre!ar$ o0 Trans"or!a!ion an( Co//unica!ions8 !rou)
is (ul$ (esi)na!e( Un(ersecre!ar$8 sall e<ercise
a(/inis!ra!i'e su"er'ision an( con!rol o'er !e Lan(
Trans"or!a!ion ;rancisin) an( Re)ula!or$ Boar( .
SECTION ,. Po2ers an( ;unc!ions o0 !e Lan(
Trans"or!a!ion ;rancisin) an( Re)ula!or$ Boar( .S1he
"oard shall:
() Prescri#e an( re)ula!e rou!es8 econo/icall$ 'ia#le
ca"aci!ies8 an( +ones or areas o0 o"era!ion o0 "u#lic lan(
!rans"or!a!ion ser'ices provided by motori8ed vehicles in
accordance with the public land transportation development plans
and programs approved by the Bepartment of 1ransportation and
ommunicationsE
(5) Issue8 a/en(8 re'ise8 sus"en( or cancel Cer!i0ica!es o0
Pu#lic Con'enience or "er/i!s au!ori+in) !e o"era!ion o0
"u#lic lan( !rans"or!a!ion ser'ices  provided by motori8ed
vehicles, and prescribe the appropriate terms and conditions
thereforE
(0) De!er/ine8 "rescri#e8 a""ro'e an( "erio(icall$ re'ie2
an( a(7us! reasona#le 0ares8 ra!es an( o!er rela!e(
car)es, relative to the operation of public land transportation
services provided by motori8ed vehiclesE
(?) Issue "reli/inar$ or "er/anen! in7unc!ion8 2e!er
"roi#i!or$ or /an(a!or$8 in all cases in 2ic i! as
7uris(ic!ion and in which cases the pertinent provisions of the
Rules of ourt shall applyE
(4) Punis 0or con!e/"! o0 !e Boar(8 #o! (irec! an(
in(irec!, in accordance with the pertinent provisions of, and the
penalties prescribed by, the Rules of ourtE
(>) Issue su#"oena an( su#"oena (uces !ecu/ an( !o
su//on 2i!nesses a""ear in an$ "rocee(in)s o0 !e Boar(8
!o a(/inis!er oa!s an( a00ir/a!ions8 an(8 in a""ro"ria!e
cases8 !o or(er !e searc an( sei+ure o0 all 'eicles an(
(ocu/en!s8 u"on "ro#a#le cause an( as /a$ #e necessar$
0or !e "ro"er (is"osi!ion o0 !e cases #e0ore i! E
(-) Con(uc! in'es!i)a!ions an( earin)s o0 co/"lain!s 0or
'iola!ion o0 !e "u#lic ser'ice la2s on lan( ! rans"or!a!ion
an( o0 !e Boar(Js rules an( re)ula!ions8 or(ers8 (ecisions
4  of ,- 
 or rulin)s an( !o i/"ose 0ines or "enal!ies 0or suc salary and privileges of a Bepartment Assistant Regional Birector.
'iola!ions Te Re)ional ;rancisin) an( Re)ula!or$ O00ices sall ear
(7) Re'ie2 /o!u "ro"rio !e (ecisionsFac!ions o0 !e an( (eci(e uncon!es!e( a""lica!ionsF"e!i!ions 0or rou!es8
Re)ional ;rancisin) an( Re)ula!or$ O00ices E 2i!in !eir res"ec!i'e a(/inis!ra!i'e re)ions #u! !a!
(3) Pro/ul)a!e rules an( re)ula!ions )o'ernin) a""lica!ionsF"e!i!ions 0or rou!es e<!en(in) #e$on( !eir
"rocee(in)s #e0ore !e Boar( an( !e Re)ional ;rancisin) res"ec!i'e !erri!orial 7uris(ic!ion sall #e ear( an(
an( Re)ula!or$ O00ice . ;owever, except with respect to (eci(e( #$ !e Boar(.
paragraphs ?, 4, > and - hereof, the rules of procedure and SECTION 44.  Appeals.STe (ecisions8 or(ers or resolu!ions
evidence prevailing in the courts of law should not be controlling o0 !e Re)ional ;rancisin) an( Re)ula!or$ O00ices sall #e
but rather the spirit and intention of said rules. 1he "oard and the a""eala#le !o !e Boar(  within thirty (0@) days from receipt of
Regional 2ranchising and Regulatory ffices shall use every and all the decision.
reasonable means to ascertain facts in each case speedily and
ob#ectively and without regard to technicalities of law and Case:
procedures, all in the interest of due processE A!& 2A1! ;&+B B1R/& +A!!
(@) ;i<8 i/"ose an( collec!8 an( " erio(icall$ re'ie2 an( 11+& /1&!
a(7us!8 reasona#le 0ees an( o!er rela!e( car)es 0or F%' !ecretary of B1 / the +egislature
ser'ices ren(ere( E +abor issued a authority given by delegated to the
() ;or/ula!e8 "ro/ul)a!e8 a(/inis!er8 i/"le/en! an( enter v. %emorandum respondent +12R" defunct Public
en0orce rules an( re)ula!ions on lan( !rans" or!a!ion "u#lic arcia ircular allowing to provincial bus !ervice
u!ili!ies8 s!an(ar(s o0 /easure/en!s or (esi)n8 an( rules provincial bus operators to set a ommission the
an( re)ula!ions re&uirin) o"era!ors o0 an$ "u#lic lan( operators to fare range of plus power of fixing the
!rans"or!a!ion ser'ice !o e&ui"8 ins!all an( "ro'i(e in !eir charge passengers or minus 4H, rates of public
u!ili!ies an( in !eir s!a!ions suc (e'ices8 e&ui"/en!8 rates within a later increased to services. 1he
0acili!ies an( o"era!in) "roce(ures an( !ecni&ues as /a$ range of 4H plus 5@H and +12R" is li9ewise
"ro/o!e sa0e!$8 "ro!ec!ion8 co/0or! an( con'enience !o above and 4H minus 54H, over vested with the
"ersons an( "ro"er!$ in  their charges as well as the safety of below the +12R" and above the same under &
persons and property within their areas of operationE official rate for a existing 5@5. motori8ed
(5) Coor(ina!e an( coo"era!e 2i! o!er )o'ern/en! period of  year. authori8ed fare vehicles.N 1he
a)encies an( en!i!ies concerne( 2i! an$ as"ec! in'ol'in) 1he +12R" without having to +12R" may
"u#lic lan( !rans"or!a!ion  services with the end in view of hairman then file a petition for implement broad
effecting continuing improvement of such servicesE and submitted a the purpose, is policies laid down
(0) Per0or/ suc o!er 0unc!ions an( (u!ies as /a$ #e memorandum to unconstitutional: in a statute by
"ro'i(e( #$ la2 , or as may be necessary, or proper or incidental the !ecretary of  Ges Nfilling inN the
to the purposes and ob#ectives of the BepartmentE B1, suggesting details which the
SECTION 4-. Decisions o0 !e Boar( E Appeals therefrom or a reevaluation of +egislature may
Review 1hereof.STe Boar(8 in !e e<ercise o0 i!s "o2ers the memo circular neither have time
an( 0unc!ions8 sall si! an( ren(er i!s (ecision en #anc . previously issued. or competence to
&very such decision, order, or resolution of the "oard must #ear 1he P"AP filed provide. "ut it
!e concurrence an( si)na!ure o0 a! leas! !2o 546 /e/#ers an application for cannot, as
!ereo0. fare rate increase regulatory bodies,
1he decision, order or resolution of the "oard shall be a""eala#le of P@.@74. 1he delegate that
!o !e Secre!ar$ 2i!in !ir!$ 5-6 (a$s 0ro/ recei"! o0 !e application was power to a
(ecision. ;owever, the Secre!ar$ /a$ /o!u "ro"rio re'ie2 opposed by the common carrier, a
an$ (ecision or ac!ion o0 !e Boar( #e0ore !e sa/e Philippine transport operator,
#eco/es 0inal. onsumers or other public
SECTION 4,. Re)ional ;rancisin) an( Re)ula!or$ O00ices . 2oundation, nc. service. 1his
 STere sall #e a Re)ional ;rancisin) an( Re)ula!or$ alleging that the consists an undue
O00ice in eac o0 !e a(/inis!ra!i'e re)ions o0 !e coun!r$ proposed rates delegation of
which shall be headed by a Regional Birector having the ran9, were exorbitant legislative
4  of ,- 
 and unreasonable. authority. 1his !rans"or!a!ion and communication entities are not #eopardi8ed and do not
would leave the encourage inefficiency and distortion of traffic patronageE
riding public at the
mercy of transport ?. Bevelop an integrated plan for a nationwide transmission system in
operators who accordance with the national and international telecommunication service
may increase fares reCuirement including, among others,radio and television broadcast relaying,
every hour, every leased channel services and data transmissionE
day, every month
or every year, 4. uide government and private investment in the establishment, operation
whenever it and maintenance of an international switching system for incoming and
pleases them or outgoing telecommunication servicesE
whenever they
deem it >. &ncourage the development of a domestic telecommunication industry in
Nnecessary.N coordination with the concern entities particularly, the manufacture of
communications$ electronics eCuipment and components to complement and
support as much as possible, the expansion, development, operation and
Class No!es: maintenance of the nationwide telecommunications networ9E
- +1 is mainly for private transportation. "'1 +1 grants licenses to drivers. -. Provide for a safe, reliable and efficient postal system for the country.
- +12R" is for public utilities.
- B1 has control and supervision over land agencies. /ot the case with air RA 3534, !ections @6.
agencies. SEC. ,-. Kuris(ic!ion Po2er an( Du!ies o0 *ARINA.  6 1he *ARINA sall
o hy* +and transportation is Imore sensitiveJ and reCuires more a'e !e "o2er an( au!ori!$ !o :
care and caution. () Re)is!er 'esselsE
(5) Issue cer!i0ica!es o0 "u#lic con'enience or an$ e<!ensions or
#. Wa!er a/en(/en!s !ere!o, authori8ing the operation of all 9inds. lasses and types of
i. *ari!i/e In(us!r$ Au!ori!$ vessels in domestic shipping: Provided, 1hat no such certificate shall be valid for a
period of more than twenty6five (54) yearsE
Rele'an! "ro'isions: (0) *o(i0$8 sus"en( or re'o9e a! an$ !i/e u"on no!ice an( earin)8 an$
cer!i0ica!e8 license or accre(i!a!ion  it may have issued to any domestic ship
& 546A, !ection ?. %andate. 1he *inis!r$ sall #e !e operatorE
"ri/ar$ "olic$8 "lannin)8 "ro)ra//in)8 coor(ina!in)8 (?) Es!a#lis an( "rescri#e rou!es8 +ones or areas o0 o"era!ions o0 (o/es!ic
i/"le/en!in)8 re)ula!in)8 an( a(/inis!ra!i'e en!i!$ o0 si" o"era!orsE
!e E<ecu!i'e Branc o0 !e )o'ern/en! in !e (4) Re&uire an$ (o/es!ic si" o"era!or !o "ro'i(e si""in) ser'ices !o an$
"ro/o!ion8 (e'elo"/en! an( re)ula!ion o0 (e"en(a#le coas!al area8 islan( or re)ion in !e coun!r$ 2ere suc ser'ices are
an( coor(ina!e( ne!2or9s o0 !rans"or!a!ion  and necessar$ for the development of the area, to meet emergency sealift reCuirements,
communication system, as well as in the fast, sale, efficient or when public interest so reCuiresE
and reliable postal, transportation and communication services. (>) Se! sa0e!$ s!an(ar(s 0or 'essels  in accordance with applicable conventions
1o accomplish such mandate, the %inistry shall have the and regulationsE
following ob#ectives: (-) Re&uire all (o/es!ic si" o"era!ors !o co/"l$ 2i! o"era!ional an(
. Pro/o!e !e (e'elo"/en! o0 (e"en(a#le an( coor(ina!e( ne!2or9s sa0e!$ s!an(ar(s 0or 'essels se! #$ a""lica#le con'en!ions an( re)ula!ions ,
o0 !rans"or!a!ion and communication systemsE maintain its vessels in safe and serviceable conditions, meet the standards of safety
of life at sea and safe manning reCuirements, and furnish safe, adeCuate, efficient,
5. Gui(e )o'ern/en! an( "ri'a!e in'es!/en! in !e (e'elo"/en! o0 reliable and proper service at all timesE
!e coun!r$s in!er= /o(el !rans"or!a!ion and communication systems (7) Ins"ec! all 'essels !o ensure an( en0orce co/"liance 2i! sa0e!$
in a most practical, expeditious, and orderly fashion for maximum safety, s!an(ar(s and other regulationsE
service, and cost effectivenessE (3) Ensure !a! all (o/es!ic si" o"era!ors sall a'e !e 0inancial ca"aci!$
!o "ro'i(e an( sus!ain sa0e8 relia#le8 e00icien! an( econo/ic "assen)er or
0. I/"ose a""ro"ria!e /easure so !a! !ecnical8 econo/ic an( o!er car)o ser'ice, or bothE
con(i!ion 0or !e con!inuin) econo/ic 'ia#ili!$ o0 !e

:-  of ,- 
(@) De!er/ine !e i/"ac! 2ic an$ ne2 ser'ice sall a'e !o !e locali!$
it will serveE
() A(o"! an( en0orce suc rules an( re)ula!ions 2ic 2ill ensure
co/"liance #$ e'er$ (o/es!ic si" o"era!or 2i! re&uire( sa0e!$ s!an(ar(s
an( o!er rules an( r e)ula!ions on vessel safetyE
(5) A(o"! suc rules an( re)ula!ions 2ic ensure !e reasona#le s!a#ili!$
o0 "assen)ers an( 0rei)! ra!es  and, if necessary, to intervene in order to protect
public interestE
(0) Hear an( a(7u(ica!e an$ co/"lain! /a(e in 2ri!in) in'ol'in) an$
'iola!ion o0 !is la2 or !e rules an( re)ula!ions o0 !e A u!ori!$ E
(?) I/"ose suc 0ines an( "enal!ies on, including the revocations of licenses of
any domestic ship operator who shall fail to maintain its vessels in safe and
serviceable condition, or who shall violate or fail to comply with safety regulationsE
(4) In'es!i)a!e an$ co/"lain! /a(e in 2ri!in) a)ains! an$ (o/es!ic si"
o"era!or8 or an$ si""er8 or an$ )rou" o0 si""ers re)ar(in) an$ /a!!er
involving violations of the provisions of this ActE
(>) 'pon notice and hearing, i/"ose suc 0ines8 sus"en( or re'o9e
cer!i0ica!es o0 "u#lic con'enience or o!er license issue(8 or o!er2ise
"enali+e an$ si" o"era!or8 si""er or )rou" o0 si""ers 0oun( 'iola!in) !e
"ro'isions o0 !is Ac! E and
(-) Issue suc rules an( re)ula!ions necessar$ !o i/"le/en! !e
"ro'isions o0 !is Ac!: Provided, 1hat such rules and regulations cannot change or
in any way amend or be contrary to the intent and purposes of this Act.
SEC. ,,. Ra!es. = E'er$ (o/es!ic si" o"era!or sall a'e !e ri)! !o 0i< i!s
o2n "assen)er "r car)o ra!es8 or #o!.
IV. CO**ON CARRIERS
 A. In General
,. De0ini!ions8 essen!ial ele/en!s
Rele'an! "ro'isions:
ivil ode, Article -05 . Co//on carriers are "ersons8 cor"ora!ions8 0ir/s or
associa!ions en)a)e( in !e #usiness o0 carr$in) or !rans"or!in)
"assen)ers or )oo(s or #o!8 #$ lan(8 2a!er8 or air8 0or co/"ensa!ion8
o00erin) !eir ser'ices !o !e "u#lic.
Rele'an! A)#a$ani No!es:
Trans"or!a!ion (e0ine(.== a contract of 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
Classi0ica!ion :
. As to ob#ect: () thingsE (5) personsE (0) news
5. As to place of travel: () landE (5) waterE (0) air
Par!ies !o con!rac! o0 !rans"or!a!ion:
() shipper or consignor.66 person to be transportedE one who gives rise to the
contract of transportation by agreeing to deliver the things or news to be
transported, or to present his own person or those of other or others in the case of 
transportation of passengers
(5) carrier or conductor.66 one who binds himself to transport persons, things, or
news as the case may beE one employed in or engaged in the business of carrying
goods for other for hire
(0) consignee.66 the party to whom the carrier is to deliver the things being
transportedE one to whom the carrier may lawfully ma9e delivery in accordance with
its contract of carriage (but the shipper and the consignee may be one person)
;rei)! (e0ine(.== 1he terms has been defined as: () the price or compensation
paid for the transportation of goods by a carrier, at sea, from port to port. "ut the
term is also used to denote (5) the hire paid for the carriage of goods on land from
place to place, or on inland streams or la9es. 1he name is also applied to (0) the
goods or merchandise transported at sea, on land, or inland streams or la9es. 1hus
the term is used in 5 senses: to designate the price for the carriage, also called
freightage , or to designate the goods carried.
Con!rac!s !rou) !rans"or!a!ion a)en!s.==  A contract of transportation is not
changed, altered or affected by the mere fact that the obligor avails of other parties
to effect the t ransportation agreed upon, as in the case of transportation agents.
Carriers (e0ine(.== Persons or corporations who underta9e to transport or convey
goods, property or persons, from one place to another, gratuitously or for hire, and
are classified as private or special carriers, and common or public carriers
Pri'a!e carriers (e0ine(.== 1hose who transport or underta9e to transport in a
particular instance for hire or reward
Tes! 0or a co//on carrier:
() ;e must be engaged in the business of carrying goods for others as a public
employment, and must hold himself out as ready to engage in the transportation of 
goods for persons generally as a business, and not a casual occupation.
(5) ;e must underta9e to carry goods of the 9ind to which his business is confined.
(0) ;e must underta9e to carry by the methods by which his business is conducted,
and over his established roads.
(?) 1he transportation must be for hire.
1he true test is whether the given underta9ing 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 Cuantity or extent of the business actually transacted, or the no. and
character of the conveyances used in the employment (the test is therefore the
character of the business actually carried on by the carrier.)
ase : an airplane owner is a common carrier where he underta9es for hire to carry
all persons who apply for passage indiscriminately as long as there is room and no
legal excuse for refusingE airlines engaged in the passenger service on regular
schedules on definite routes, who solicit patronage of the traveling public, advertise
schedules for routes, times of leaving and rates of fare, and ma9e the usual
stipulation as to baggage are common carriers
Carac!eris!ics o0 co//on carriers:
:, of ,- 
() 1he common carrier underta9es to carry for all people indifferentlyE he holds ground to fear that the vessel and those on board will be exposed to unnecessary or
himself out as ready to engage in the transportation of goods for hire as a public unreasonable ris9s
employment and not as a casual occupation, and he underta9es to carry for all
persons indifferently, within the limits of his capacity and the sphere of the business Cases:
reCuired of him, so that he is bound to serve all who apply and is liable for refusal, A!& 2A1! ;&+B B1R/& +A!! /1&!
without sufficient reason, to do so 11+&
(5) 1he common carrier cannot lawfully decline to accept a particular class of goods '.!. v. 1an Piaco rented / 1an !ection ? of Public use6 /ot
for carriage to the pre#udice of the traffic in those goods 1an two automobile Piaco was the Public confined to
&xception : for some sufficient reason, where the discrimination in such goods is Piatco truc9s for the operating a 'tility Act or privilege
reasonable and necessary (substantial grounds) purpose of public utility  Act /o. 50@-, individuals, but
(0) /o monopoly is favored 6 the ommission has the power to say what is a carrying some for purposes of  as amended by is open to the
reasonable compensation to the utility and to ma9e reasonable rules and regulations passengers and determining section 3 of Act indefinite public.
for the convenience of the traveling public and to enforce them freight under a whether his /o. 5>3?: N1he Refers not only
(?) Public convenience 6 for the best interests of the public special contract in operations Public 'tility the carac!er
each case. were covered ommission or of the business
*eanin) o0 Pu#lic use.== t is not confined to privileged individuals, but is open to Befendants were by the Public ommissioners to be done, but
the indefinite publicE there must be a right which the law compels the owner to give charged with a 'tility Act: /o. shall have also to the
to the general public. Public use is not synonymous with public interest. 1he true violation of the general "ro"ose(
criterion is whether the public may en#oy it by right or only by permission Public 'tility +aw supervision /o(e of doing
for operating a and regulation it. /1
Te la2 "roi#i!s unreasona#le (iscri/ina!ion #$ co//on carriers.== 1he public utility of, #urisdiction synonymous
law reCuires common carriers to carry for all persons, either passengers or property, without permission and control with public
for exactly the same charge for a li9e or contemporaneous service in the from the Public over, all public interest
transportation of li9e 9ind of traffic under substantially similar circumstances or 'tility utilities. . . .
conditions. 1he law prohibits common carriers () from sub#ecting any person, etc. ommissioner. 1an 1he term
or locality, or any 9ind of traffic, to any undue or unreasonable pre#udice or Piaco was found Mpublic utilityM is
discrimination whatsoever. guilty. hereby defined
&xception: hen the actual cost of handling and transporting is different, then to include
different rates may be charged every
ases : () merchandise of li9e Cuantity may not be considered ali9e 6 individual,
the Cuantity, 9ind and Cuality may be exactly the same, and yet not be copartnership,
ali9e, so far as the cost of transportation is concerned association,
(5) shipments may be ali9e although composed of different classes of  corporation or
merchandise 6 difference in the charge for handling and transporting  #oint stoc9
may only be made when the difference is based upon actual cost company, etc.,
etc., that now
De!er/ina!ion o0 7us!i0ia#le re0usal: or hereafter
1his involves a consideration of the following66 may own,
() suitability of the vessels of the company for the transportation of such productsE operate,
(5) reasonable possibility of danger or disaster, resulting from their transportation in managed, or
the form and under the conditions in which they are offered for carriageE control any
(0) the general nature of the business done by the carrierE common
(?) all the attendant circumstances which might affect the Cuestion of the reasonable carrier,
necessity for the refusal by the carrier to underta9e the transportation of this class of  railroad, street
merchandise railway, etc.,
ase: 1he mere fact that the carriage of dynamites may lead to destructive etc., engaged
explosions is not sufficient to #ustify refusal if it can be proven that in the condition in in the
which it is offered for carriage there is no real danger to the carrier nor reasonable transportation
of passengers,
:4  of ,- 
 cargo, etc., Pangasinan. nly "assen)ers
etc., 0or 4@ cartons were or )oo(s or
"u#l ic us e.N delivered as the #o!, by land,
truc9 carrying the water, or air
;ome onsorcio / American 'nder cartons were hi6 for
nsuran PesCuero del Peru !teamship is a  American  #ac9ed in 1arlac. co/"ensa!io
ce o. of !outh America common or a  #urisprudence, Be u8man: n, offering
v. shipped #ute bags private carrier: a common endana is a their ser'ices
 Americ of Peruvian fish Private  carrier common carrier !o !e "u#lic J 
an meal through !! underta9ing to and failed to /o distinction
!teams rowborough.1he carry a special exercise whether
hip cargo was cargo or extraordinary principal or
consigned to !an chartered to a diligence. ancillary
%iguel "rewery, special person (sideline),
nc. and insured by only becomes a regular or
;ome nsurance private carrier. occasional,
ompany. 1he  As a private catering to the
cargo arrived in carrier, a  Igeneral
%anila and was stipulation publicJ or only
discharged into the exempting the a narrow
lighters of +u8on owner from segment of the
!tevedoring liability for the population
ompany hen negligence of
the cargo was its agent is not "ascos ipriano, entered "ascos is a %%/
delivered to !an against public v. A into a hauling common ARR&R
%ig, there were policy, and is contract with carrier. 1&!1:
shortages, causing deemed valid. <ibfair !hipping Nwhether the
it to lay claims 1he ivil ode  Agency orp. given
against +u8on provisions on binding itself to underta9ing is
!tevedoring, ;ome common deliver 5,@@@ a part of the
nsurance and the carriers should metric tons of soya business
 American not be applied bean meal. engaged in by
!teamship where the ipriano the carrier
 Agencies, owner carrier is not subcontracted which he has
and operator of !! acting as such "ascos to transport held out to the
rowborough. but as a ?@@ sac9s of soya general public
private carrier. bean meal. "ascos as his
Be endana is a #un9 hether  Art -05,  failed to deliver the occupation
u8ma dealer buying endana is a defines cargo. ipriano rather than the
n v. A scrap from common common filed a complaint Cuantity or
Pangasinan 2or carrier  Ges carriers as for a sum of extent of the
which, he uses his  Ipersons, money for breach business
5 six6wheeler corporations, of a contract of transactedN
truc9s. Be u8man firms or carriage. /otwithstandin
contracted associations g "ascosD
endana for the engaged in the argument that
delivery of cartons #usiness o0 their business
of +iberty filled carr$in) or offers their
mil9 from %a9ati to !rans"or!in) services only to

::  of ,- 
 a select group ;AR1&R: lease
of people, she of the whole
is still a vesselE transfer
common command and
carrier possession as
Planter PP bought 'rea hether a 1he distinction ;AR1&R well as master
s ?>H fertili8er from common between a PAR1G: a and crew
Product %itsubishi which carrier Ncommon or contract by carrier
s nc. the latter shipped becomes a public carrierN which an entire #eco/es a
v. A in bul9 aboard %$ private carrier and a Nprivate ship, or some "ri'a!e carrier
!un Plum, a vessel by reason of a or special principal part
owned by Fyosei charter6party carrierN lies in thereof, is let by 2abre !ps. 2abre owned hether 2abres did not
Fisen Fabushi9i I! the character the owner to v. A a %a8da minibus 2abres are have to be
Faisha (FFFF), (e"en(s of the another person operating as a liable as engaged in the
from '!A to +a 333 is a business, such for a specified school bus service common business of
'nion. 1he report co//on that if the time or useE a in %anila. ord for carrier  Ges public
of the private carrier underta9ing is contract of the orld hristian transportation
marine cargo a single affreightment by 2ellowship for the
surveyor hired by transaction, which the owner arranged with !ps. provisions of
PP revealed a not a part of of a ship or 2abre the the ivil ode
shortage and that the general other vessel lets transportation of on common
7%1 was business or the whole or a 00 members of its carriers to
contaminated with occupation, part of her to a  Gouth %inistry apply to them.
dirt. 1he carrier although merchant or P0,@@@. n their  As common
refused to grant involving the other person for way to +a 'nion, carriers, they
the claim. PP filed carriage of the conveyance they had to ta9e a are bound to
an action for goods for a of goods, on a different route as a observe
damages. FFFF: fee, the person particular bridge was under extraordinary
strict public policy or corporation voyage, in repair. t was diligence and
governing carriers offering such consideration of abilDs first trip to the showing of
does not apply to service is a the payment of +a 'nion and he a diligence of a
them because they private carrier. freight was not familiar good father of
have become a /1RA1 2 with the area. a family in the
private carrier by  A22R&;1%&/ 1hey met an selection and
reason of the 1: lease of accident. supervision of
charter party. shipping space their
for goods employees
carrier does not
re/ains !o #e excuse them
"u#lic from such
1%& ;AR1&R: standard of
fixed period of care as
time provided under
 GA&  Art. -43.
;AR1&R: single
voyage only  Asia "etter estern  Asia +ighterage  Art. -05 does
;AR1&R "G +ighter hite heat was is a common not distinguish
B&%!& R age shipped by carrier. between an
"AR&"A1 and %arubeni American entity having

:>  of ,- 
!hippin orporation on the principal &stela did not service of goods.
g v. A board the ship %$ business chec9 her travel arranging and aravanDs
/& G%"B'% activity of documents and facilitating business is
for delivery to carrying discovered that the petitionerDs ma9ing travel
eneral %illing persons or flight she was boo9ing, arrangements
orp. in %anila. goods, and one supposed to ta9e tic9eting and for its
Prudential where such already left the day accommodatio customers,
uarantee insured carrying of before. &stela filed n in the /1
the shipment persons and$or a complaint pac9age tour, transporting
against loss or goods is only against aravan as a)ains! passengers or
damage. hen the ancillaryE Also, for breach of !e o#7ec! o0 goods from
ship arrived in no distinction contract of a con!rac! o0 one place to
%anila, the cargo between one carriage and carria)e === another. 1he
was transferred to offering its damages. !e nature of the
 Asia +ighterage services to the !rans"or!a!io contractual
and !hipping nc.Ds general public, n o0 relation
custody. Asia or only to a "assen)ers between two
+ighterage pulled niche. or )oo(s. parties is
the barge to an determinative
island to shield it of the degree
from the of care
approaching reCuired in the
typhoon. 1he performance of 
barge either partyDs
subseCuently obligation
developed a IlistJ under the
due to a hole contract.
which was formed +oadst +oadstar received +oadstar is a 1he public
after the barge hit ar on its vessel %$ common character is not
something !hippin hero9ee shipment carrier. t is affected by the
underwater. t was g insured with not necessary fact that
patched. ompa private respondent that a carrier carriage of
!ubseCuently, the ny v. %anila nsurance be issued a goods was
barge san9 A o. (%). !hip certificate of periodic,
completely after its san9. +oadstar public occasional or
 Itowing bitsJ argued that it was convenience unscheduled.
bro9e. 1he cargo a private carrier (P) first 1he above
that remained on because it was not before being definition
the barge was issued a certificate held liable as it neither ma9es
completely lost. of public is not a any distinction
risost &stela risostomo aravan is not /ot a common convenience, it did reCuisite for between the
omo v. contracted aravan a common carrier under not have a regular incurring carriage of
A 1ravel and 1ours carrier. 1he  -05 if it is trip or schedule, liability under goods and
ntDl nc.Ds services ob#ect of /1 an entity and it had only one the  persons as a
to facilitate her &stelaDs engaged in the shipper for a provisions for principal
boo9ing, tic9eting, contractual business of special cargo. common business and
and relation with transporting carriers. 1he as an ancillary
accommodation in aravan is either liability arises activity, nor
a &uropean tour. aravanDs passengers or the moment a one between

:  of ,- 
 person or firm carriers carriers by air land occupation.
acts as a offering and water.J 5. ;e must
common services to the Respondents underta9e to
carrier, without general public assert that carry goods of
regard to those which pipelines are not the 9ind to
whether or not cater to a included in the which his
such carrier narrow term Icommon business is
has complied segment.. carrierJ  confinedE
with regulatory 0. ;e must
rules. 1o underta9e to
exempt them carry by the
from liability method by
for not having which his
a P would business is
be offensive to conducted and
public policy as over his
it would established
amount to roadsE and
rewarding ?. 1he
entities li9e transportation
+oadstar for must be for
failing to hire.
comply with
regulations. Class No!es:
2irst Petitioner is a Petitioner is a 1he test for o Befinition is parallel to that of public utility
Philippi grantee of a common determining o &xamples of common carriers: #eepneys, buses, planes
ne pipeline carrier. whether a o /ote the Be u8man tests and the "ascos tests
ndustr concession. party is a o  As a common carrier, youDre liable for culpa contractual and for
ial Petitioner filed with  A Icommon common Cuasi6delict and, sometimes, even for delict.
orpor the R1 of carrierJ may be carrier of
ation v. "atangas ity a defined, goods is: 4. Na!ure o0 #usiness "o2er o0 S!a!e !o re)ula!e
A complaint for tax broadly, as one
refund. who holds . ;e must be Rele'an! "ro'isions:
Respondents himself out to engaged in the
argued that the public as carrying of ivil ode, Article ->4. 1he Pu#lic Ser'ice Co//ission /a$8 on i!s o2n
petitioner cannot engaged in the goods for /o!ion or on "e!i!ion o0 an$ in!eres!e( "ar!$8 a0!er (ue earin)8 cancel !e
be exempt from business of others as a cer!i0ica!e o0 "u#lic con'enience )ran!e( !o an$ co//on carrier !a!
taxes under !ec. transporting public re"ea!e(l$ 0ails !o co/"l$ 2i! is or i!s (u!$ !o o#ser'e e<!raor(inar$
00 (<) of the persons or employment, (ili)ence as prescribed in this !ection.
+ocal overnment property from and must hold
ode as said place to place, himself out as Rele'an! A)#a$ani No!es:
exemption applied for ready to Co//on carriers are su#7ec! !o le)isla!i'e re)ula!ion.== 1he business of a
only to compensation, engage in the common carrier holds such a peculiar relation to the public interest that there is
 Itransportation offering his transportation superinduced upon it the right of public regulation. 1he business of a common carrier
contractors and services to the of goods or is affected with public interest. hen, therefore, one devotes his property to a use in
persons engaged public persons which the public has an interest, he, in effect, grants to the public an interest in that
in the generally. generally as a use, and must submit to be controlled by the public for the common good, to the
transportation by business and extent of the interest he had thus created.
hire and common not as a casual

:?  of ,- 
Li/i!a!ion on "o2er !o re)ula!e.== !uch regulations must not have the effect of  !uch extraordinary diligence in the vigilance over the goods is further expressed in
depriving an owner of his property without due process of law, nor of confiscating, or
appropriating private property without #ust compensation, nor of limiting or
prescribing irrevocably vested rights or privileges lawfully acCuired under a charter or
franchise #ust compensation, due process of lawQ
Wen 7u(iciar$ /a$ in!er0ere 2i! le)isla!i'e re)ula!ion o0 co//on
carriers.== 1he #udiciary ought not to interfere with legislative regulations unless
they are so plainly and palpably unreasonable as to ma9e their enforcement
eCuivalent to the ta9ing of property for public use without such compensation as
under all circumstances is #ust both to the owner and to the public.
articles -0?, -04, and -?4, /os. 4, >, and -, while the extraordinary diligence for
the safety of the passengers is further set forth in articles -44 and -4>.
Rele'an! A)#a$ani No!es:
E<!raor(inar$ (ili)ence re&uire( o0 co//on carriers.== 1he law reCuires  to
exercise extra6 ordinary diligence which means that they must render service with the
greatest s9ill and utmost foresight. 1he extra6ordinary diligence reCuired of carriers in
the handling of the goods of the shippers and consignees last from the time the
cargoes are loaded in the vessels until they are discharged and delivered to the
consignees.

Case: Reasons 0or re&uirin) e<!ra=or(inar$ (ili)ence.==  1he nature of the business of 
A!& 2A1! ;&+B B1R/& +A!! common carriers and the exigencies of public policy demand that they observe extra6
11+& /1&! ordinary diligenceE the business of  is impressed with a special public duty and
Pantranco PA/1RA/ filed with !tateDs ommon carrier therefore sub#ect to control and regulation by the state. 1he public must of necessity
v. P! the Public !ervice regulation is businessD relation to rely on the care and s9ill of  in the vigilance over the goods and safety of the
ommission an  #ustified and the public interest passengers.
application to operate has basis.  #ustifies the right of
ten new truc9s. 1he public regulation. Ri)orous la2 on co//on carriers no! a""lica#le !o s"ecial e/"lo$/en! as
Public !ervice Private property carrier.== 1he laws applicable to  are rigorous and should not be extended to a
ommission granted devoted to a use person who has neither expressly assumed that character, nor by his conduct and
PA/1RA/Ds imbued with public from the nature of his business #ustified the belief on the part of the public that he
application, sub#ect to interest grants the intended to assume it.
5 conditions: 1hat the public an interest in
certificates of public that use and must Re)is!ere( o2ner "ri/aril$ an( soli(aril$ lia#le 2i! (ri'er8 un(er !e
convenience and the submit to be 9a#i! s$s!e/.== Registered owner is primarily and solidarily liable for the damage
authori8ation granted controlled by the caused by the vehicle registered in his name, even if the said vehicle had already
it shall only be valid for public for the been sold, leased or transferred to another person who was, at the time of the
54 years from the date common good !o accident, actually operating the vehicle. 1he operator of record continues to be the
of enactment of P!Ds !e e<!en! o0 operator of the vehicle in contemplation of law, as regards the public and third
decision granting in!eres! e as persons, and as such is responsible for the conseCuences incident to its operationE
PA/1RA/Ds crea!e(. (Right of such owner$operator of record is held in contemplation of law as the employer of the
application, and that the state to exercise driver.
the Philippine ovDt or legislative control
any of its agencies over public utilities) 3a#i! s$s!e/.== ne whereby a person who has been granted a certificate of public
may acCuire i. convenience allows other persons who own vehicles to operate them under such
PA/1RA/ at any license, for a fee or percentage of the earnings. 1his is contrary to public policy, and
time. therefore, void and inexistentE Nthis is a pernicious system that cannot be too
severely condemnedE it constitutes an imposition upon the good faith of the govt.N
. Na!ure an( Basis o0 Lia#ili!$
Reason 0or ol(in) re)is!ere( o2ner lia#le.== 1he law does not relieve the
Rele'an! "ro'isions: registered owner directly of the responsibility that the law fixes and places upon him
as an incident or conseCuence of registration 66 where a registered owner allowed to
ivil ode, Article -00. Co//on carriers8 0ro/ !e na!ure o0 !eir #usiness evade responsibility by proving who the supposed transferee or owner is, it would be
an( 0or reasons o0 "u#lic "olic$8 are #oun( !o o#ser'e e<!raor(inar$ easy for him by collusion with others or otherwise, to escape said responsibility and
(ili)ence in !e 'i)ilance o'er !e )oo(s an( 0or !e sa0e!$ o0 !e transfer the same to an indefinite person or to one who possesses no property with
"assen)ers !rans"or!e( #$ !e/8 accor(in) !o all !e circu/s!ances o0 eac which to respond financially for the damage or in#ury doneE in case of an accident,
case.
:  of ,- 
the registered owner should not be allowed to disprove his ownership to the in avoiding the ordinary exert
pre#udice of the person in#ured or to be relieved from responsibility collision which diligence in the extraordinary
resulted in the vigilance over diligence
Cases: in#ury caused the goods and according to all
A!& 2A1! ;&+B B1R/& +A!! /1&! to the plaintiff. for the safety circumstances
11+&  G&!. of the of each caseE
angco <ose angco came 1he  Article 3@0 angco case: passengers (5) a carrier is
v. %RR  in by train daily to con!rac!ual (old civil code) Becided in transported by obliged to carry
the %anila Railroad o#li)a!ion o0 ma9es the 37 so the  them according its passenger
ompany. ne *anila distinction provisions were to all the with the
evening, he got off  Railroa( !o between not yet in circumstances utmost
the train expecting !rans"or! private effect so it was of each case. diligence of a
to land at the "lain!i00 also individuals and not decided  AR1. -44. A very cautious
concrete platform carrie( 2i! public based on such common person, having
where people i! !e (u!$ !o enterprise in provisions. carrier is due regard for
safely alight but !rans"or! that wrt to the  Also, the bound to carry all the
his foot$feet came i/ sa0el$ liability of a ourtDs analogy the passengers circumstancesE
into contact with a an( !o master for the on culpa safely as far as (0) a carrier is
sac9 of "ro'i(e sa0e negligent acts contractual and human care presumed to
watermelons, /eans 0or of his servants culpa aCuiliana and foresight be at fault or
causing him to fall !e "lain!i00 in the case of having a can provide, to have acted
onto the platform, !o en!er an( public relationship li9e using the negligently in
and his body to roll lea'e i!s enterprises, that of a utmost case of death
from the platform !rains8 #ase( the law creates concentric diligence of of, or in#ury to,
and become drawn on OCC ,4. a rebuttable circle O not very cautious passengers, it
under the moving Proof of fault presumption of  accurate co8 persons, with a being its duty
car (right arm imputable to negligence in one does not due regard for to prove that it
badly lacerated). %anila the selection or really fully all the exercised
RailroadDs direction of the subsume the circumstances. extraordinary
servants B&! said servants. other.  AR1. -4>. n diligenceE and
/1 &L'!& 1his, even if case of death (?) the carrier
%anila Railroad the action was of or in#uries to is not an
from being based on the passengers, insurer against
liable to the contract of common all ris9s of
plaintiff. transportation carriers are travel.
presumed to
saac v. saac paid and / +. Rules Principles have been at
 A.+. boarded "us /o.  Ammen governing this governing the fault or to have
 Ammen 0 of A.+. Ammen. 1ranspo o.  #urisdiction: liability of a acted
1he bus collided has observed  AR1. -00. common negligently,
with a motor extraordinary ommon carrier: unless they
vehicle. saacDs left diligence or the carriers, from () the liability prove that they
arm was utmost the nature of of a carrier is observed
completely diligence of their business contractual and extraordinary
severed. every cautious and for arises upon diligence as
person, having reasons of breach of its prescribed in
due regard for public policy, obligation. articles -00
all are bound to 1here is breach and -44.
circumstances, observe extra if it fails to 2ores v. %iranda was one / %iranda eneral rule: &L&P1/!

:  of ,- 
%iranda of the passengers is entitled to %oral damages 1 1;& stepped on the breach of the and this
on a #eepney. 1he moral are not &/&RA+ bra9e, as a result contract of disputable
driver lost control. damages* /. recoverable in R'+&: of which, the carriage. presumption
<eepney was found damage 61he resulting  #eepney which was 1he contract of  may only be
to be registered in actions in the death of then running on carriage is overcome by
the name of Pa8 predicted on a a passenger, in the eastern lane between the evidence that
2ores (operator). breach of the which case (its right of way) carrier and the he had
2ores however contract of  Article ->? made a '6turn, passenger, and observed
claims that a day transportation. ma9es the invading and in the event of extra6ordinary
before the accident n case of common eventually contractual diligence as
happened, she breach of carrier stopping on the liability, the prescribed in
allegedly sold the contract expressly western lane of carrier is  Articles -00,
passenger #eep to (including one sub#ect to the the road in such a exclusively -44 and -4>
!ac9erman so she of rule of Art. manner that the responsible of the /ew
claims that she is transportation) 55@>, that  #eepneyMs front therefore to ivil ode 5 or
no longer liable for proof of bad entitles the faced the south the passenger that the death
what happened to faith or fraud deceased (from where it or in#ury of the
2ores. (dolus), i.e., passenger to came) and its rear passenger was
wanton or Ndemand moral faced the north due to a
deliberately damages for (towards where it fortuitous
in#urious mental anguish was going). A bus event E n an
conduct, is by reason of bumped from action for
essential to the death of behind the right damages
 #ustify an the deceasedN rear portion of the against the
award of moral 6here the  #eepney. carrier for his
damages. in#ured failure to safely
passenger does carry his
not die, moral passenger to
damages are his destination,
not recoverable an accident
unless it is caused either
proved that the by defects in
carrier was the automobile
guilty of malice or through the
or bad faith negligence of
based also on its driver, is
->? not a caso
fortuito which
Phil. Respondents %angune and n culpa would avoid
Rabbit v. boarded the arreon are contractual, the carriers
A  #eepney. 1hey paid not #ointly and the moment a liability for
%analo P5?.@@ for severally liable passenger dies damages E 1he
the trip. 1he right with %analo. or is in#ured, driver cannot
rear wheel of the 1he driver the carrier is be held #ointly
 #eepney was cannot be held presumed to and severally
detached, so it  #ointly and have been at liable with the
was running in an severally liable fault or to have carrier in case
unbalanced with the carrier acted of breach of
position. %analo in case of negligently, the contract of

:  of ,- 
 carriage. o  Advantage of using breach of contract as ground: &ven if  used due diligence
in hiring employees, still liable. Also, s have to observe extraordinary diligence
+R1A v. /avidad, then nly +R1A is 1he law  higher bar.
/atividad drun9, was liable for the reCuires o  Advantage of using Cuasi6delict as cause of action: /o need to prove contractual
standing on the death of common relation  good if that relationship is in doubt. Also, you can go after practically
platform near the /avidad. carriers to anyone involved. Also, no need to establish bad faith to get moral damages
+R1 trac9s. carry
&scartin, the passengers >. Classes o0 Co//on Carriers
security guard safely using
assigned to the the utmost Rele'an! "ro'isions:
area approached diligence of
/avidad. A very cautious ivil ode, Article -05. Co//on carriers are "ersons8 cor"ora!ions8 0ir/s or
misunderstanding persons with associa!ions en)a)e( in !e #usiness o0 carr$in) or !rans"or!in)
or an altercation due regard for "assen)ers or )oo(s or #o!8 #$ lan(8 2a!er8 or air8 0or co/"ensa!ion8
between the two all o00erin) !eir ser'ices !o !e "u#lic.
apparently ensued circumstances.
that led to a fist  is ivil ode, Article -00. Co//on carriers8 0ro/ !e na!ure o0 !eir #usiness
fight. /avidad fell liable for death an( 0or reasons o0 "u#lic " olic$8 are #oun( !o o#ser'e e<!raor(inar$
on the +R1 trac9s. of or in#ury to (ili)ence in !e 'i)ilance o'er !e )oo(s an( 0or !e sa0e!$ o0 !e
 At the exact passengers (a)
"assen)ers !rans"or!e( #$ !e/, according to all the circumstances of each case.
moment that through the
/avidad fell, an negligence or !uch extraordinary diligence in the vigilance over the goods is further expressed in
+R1 train, wilful acts of articles -0?, -04, and -?4, /os. 4, >, and -, while the extraordinary diligence for
operated by its employees the safety of the passengers is further set forth in articles -44 and -4>.
Roman, was or b) on
coming in. account of ivil ode, Article -44 . A co//on carrier is #oun( !o carr$ !e "assen)ers
wilful acts or sa0el$ as 0ar as u/an care an( 0oresi)! can "ro'i(e8 usin) !e u!/os!
negligence of (ili)ence o0 'er$ cau!ious "ersons8 2i! a (ue re)ar( 0or all !e
other circu/s!ances.
passengers or
of strangers if . La2 A""lica#le
the common
carrierDs Rele'an! "ro'isions:
employees
through the ivil ode, Article ->>. In all /a!!ers no! re)ula!e( #$ !is Co(e8 !e ri)!s
exercise of due an( o#li)a!ions o0 co//on carriers sall #e )o'erne( #$ !e Co(e o0
diligence could Co//erce an( #$ s"ecial la2s .
have prevented
or stopped the ivil ode, Article -40 . Te la2 o0 !e coun!r$ !o 2ic !e )oo(s are !o #e
act or !rans"or!e( sall )o'ern !e lia#ili!$ o0 !e co//on carrier 0or !eir loss8
omission. (es!ruc!ion or (e!eriora!ion.

Class No!es: Relevant Agbayani /otes:

o s may still be subsidiarily liable for delict even if acting through agents.
o ivil ode provisions might be the basis of liability but the nature of the liability is
still contractual because the ivil ode provisions govern contracts and thus,
presupposes, on the part of common carriers, that a contract exists.
 Remember that contracts need not be in writing. 1hey may even be implied.
Ne2 Ci'il Co(e "ri/aril$ )o'erns co//on carriers.== 1he Provisions of the
ivil ode -056 ->>Q primarily govern common carriers and the provisions of the
ode of ommerce verland1ransportation and %aritime ommerceQ and special
laws arriage of oods by !ea ActE !alvage ActQ have only subsidiary application to
common carriers.

>-  of ,- 
B.Co//on Carria)e o0 Goo(s
,.Lia#ili!$ an( Presu/"!ion o0 Ne)li)ence
Rele'an! Pro'isions:
ivil ode, Article -00. Co//on carriers8 0ro/ !e na!ure o0 !eir #usiness
an( 0or reasons o0 "u#lic "olic$8 are #oun( !o o#ser'e e<!raor(inar$
(ili)ence in !e 'i)ilance o'er !e )oo(s  and for the safety of the passengers
transported by them, accor(in) !o all !e circu/s!ances o0 eac case.
!uch extraordinary diligence in the vigilance over the goods is further expressed in
articles -0?, -04, and -?4, /os. 4, >, and -, while the extraordinary diligence for
the safety of the passengers is further set forth in articles -44 and -4
ivil ode, Article -0?. Co//on carriers are res"onsi#le 0or !e loss8
(es!ruc!ion8 or (e!eriora!ion o0 !e )oo(s8 unless !e sa/e is (ue !o an$ o0  Carrier as (u!$ !o 9ee" an( care 0or )oo(s carrie(.== t is the duty of the 
!e 0ollo2in) causes  only:
(,6 ;loo(8 s!or/8 ear!&ua9e8 li)!nin)8 or o!er na!ural
(isas!er or cala/i!$
546 Ac! o0 !e "u#lic ene/$ in 2ar8 2e!er in!erna!ional or
ci'il
56 Ac! or o/ission o0 !e si""er or o2ner o0 !e )oo(s
5>6 Te carac!er o0 !e )oo(s or (e0ec!s in !e "ac9in) or in
!e con!ainers
56 Or(er or ac! o0 co/"e!en! "u#lic au!ori!$.
ivil ode, Article -04 . In all cases o!er !an !ose /en!ione( in Nos. ,8 48
8 >8 an(  o0 !e "rece(in) ar!icle8 i0 !e )oo(s are los!8 (es!ro$e( or
(e!eriora!e(8 co//on carriers are "resu/e( !o a'e #een a! 0aul! or !o
a'e ac!e( ne)li)en!l$8 unless !e$ "ro'e !a! !e$ o#ser'e( e<!raor(inar$
(ili)ence as reCuired in article -00 .
Rele'an! A)a#a$ani No!es:
Res"onsi#ili!$ o0 co//on carriers.== n general,  are responsible for the loss,
destruction, or deterioration of the goods carried by them. 1his responsibility arises
from contract, as the relation between a carrier and its patrons is of a contractual
nature. A failure on the carrier to use extra6ordinary care in carrying goods or
passengers safely is a breach of contract and constitutes culpa contractual not culpa  passengers and the goods given the circumstances.
aCuiliana . hile the liability of a carrier as an insurer is not recogni8ed in this
 #urisdiction, a carrier is liable for damages suffered by goods carried if such damages
arise from its negligence. 1he carrier is also liable even in those cases where the
cause of the lossor damage is un9nown.
Due e<!raor(inar$ (ili)ence re&uire(8 carriers )i'en 2i(e (iscre!ion in
selec!ion an( su"er'ision o0 "ersons !o an(le )oo(s.== 1he law reCuires 
to exercise extra6o diligence which means that they must render service with the
greatest s9ill and utmost foresight. 1he extra6o diligence reCuired of  in the
handling of the goods of the shipper and the consignees lasts from the time the
cargoes are loaded in the vessels until they are discharged and delivered to the
consignees. 1o comply with this obligation,  should be afforded the right of having
a wide discretion in the selection and supervision of persons who will handle the
goods.
 Air carrier can !er/ina!e ser'ices o0 "ilo! 0or serious /iscon(uc! an(
(run9enness8 #ecause o0 i!s (u!$ o0 e<!raor(inar$ (ili)nece.== 1he  can
terminate the services of its drivers, pilots and &&s for serious misconduct and
drun9enness because of its duty of extra6ordinary diligence. henever a passenger
dies or is in#ured the presumption is that the  is at fault notwithstanding the fact
that it has exercised due diligence of a good father of a family in the selection and
supervision of its &&s. 1hus, extra6 ordinary measures and diligence should be
exercised by it for the safety of its passengers and their belongings. A  can
terminate an && whose continued service is inimical to its interests and the safety of 
the passengers.
to properly and carefully handle, carry, 9eep and care for the goods carried and to
exercise due care to ascertain and consider the nature of the goods offered for
shipment and to use such methods for their care during the voyage as their nature
reCuires. 1he carrier is liable for in#ury to, or loss of, cargo resulting from the failure
to properly care for and handle the cargo en routeE and it is reCuired to provide
adeCuate ventilation for the safe carriage of the cargo, and provide reasonable and
ordinary inspection and care in and about the transportation of cargo. A vessel should
not accept cargo unless it can be given the type of storage that its character reCuires,
for placing of conditions in a bill of lading does not relieve the vessels of obligation to
ta9e appropriate care of the cargo.
Du!$ o0 carrier !o (eli'er car)o in )oo( con(i!ion as 2en loa(e(.== 1here is
no absolute obligation for a  to accept cargo. t should not be accepted unless it
can be given the type of storage that its character reCuires. here a vessel accepts a
cargo for shipment for valuable consideration, it ta9es the ris9 of delivering it in good
condition as when it was loaded. And if the fact of improper pac9ing is 9nown to the
carrier or his servants, or apparent upon ordinary observation, but it accepts the
goods notwithstanding such condition, it is not relieved of liability for loss or in#ury
resulting therefrom.
n the exercise of extra6ordinary diligence reCuired by law, the  must give due
regard to all circumstances and ta9e all steps necessary to insure the safety of the
Presu/"!ion o0 ne)li)ence.== 'nder Art. -04, if the goods are proved to have
been lost, destroyed or deteriorated,  are presumed to have been at fault or to
have acted negligently, unless they prove that they have observed the extra6o
diligence reCuired by law.
1he plaintiff needs only to prove that the goods he transported have been lost,
destroyed or deteriorated.  must then prove that he has exercised extra6ordinary
diligence reCuired by law or that the loss, etc. was due to accident or some other
circumstances inconsistent with its liability
%ere proof of delivery of goods in order to a carrier, and of their arrival at the place
of destination in bad order ma9es out a prima facie case against the 
>, of ,- 
De0enses a'aila#le !o CC: with its liability.
. Art. -0?
5. Art. -04 (exercise of extra6ordinary diligence reCuired by law) %irasol v. %irasol is the Bollar is 1he fact that 1he defendant
0. /atural disaster: 1he  is exempt from liability if he proves that the loss or Bollar owner of 5 liable. the cases were having
destruction of the merchandise was due to accident and force ma#eure and not to boo9 cases damaged by admitted that
fraud, fault or negligence on the part of the &&s and owners of the . shipped on Nsea water,N the boxes were
 cannot interpose the defense that it exercised due diligence in the selection and board BollarMs standing alone, damaged while
supervision of &&s. 1he liability of the  arises from breach of the contract of  ship. 1he two is /1 evidence in transit and
carriage and not from culpa aCuiliana . t is however the duty of  to teach their cases arrived that they were in its
drivers not to overload vehicles, not to exceed safe and legal speed limits, and other in %anila in damaged by possession, the
safety precautions. bad order. force ma#eure. burden of  
Befendant has here the peril proof then
Carrier no! insurer.==  are not reCuired to exercise all the care, s9ill and refused to is the proximate shifted, and it
diligence of which the human mind can conceive nor such as will free the pay, giving as cause of the devolved upon
ransportation of passengers from all possible perils. A  is not an insurer of the its reason that loss, the the defendant
safety of the passengers and is not absolutely and at all events to carry them safely the damage in shipowner is to both allege
and without in#ury. Cuestion Nwas excused. and prove that
caused by sea the damage
Cases: waterJ. Bollar was caused by
A!& 11+& 2A1! ;&+B B1R/& +A!! /1&! alleges that reason of some
 Gnchausti  Gnchausti Petitioner is 1he mere proof  the bill of   fact which
!teamship o. acted as the liable for loss. of delivery of  lading exempted it
v. Bexter common goods in good indicates that from liability.
carrier for 5 order to a he shall not be  As to how the
mineral oils. carrier, and of  liable for boxes were
hen the their arrival at damages damaged,
goods were the place of  caused by when or
delivered by destination in NActs of odN where, was a
the shipper to bad order, or Nperils of  matter
the carrier, ma9es out a the seaJ such peculiarly and
they were prima facie case as seawater. exclusively
received in against the within the
good carrier, so that 9nowledge of 
condition. if no the defendant
;owever, explanation is and in the very
when they given as to how nature of  
were received the in#ury things could
by the occurred, the not be in the
consignee, carrier must be 9nowledge of 
they were held the plaintiff.
allegedly responsible. t
received in a is incumbent 4.E<e/"!ion 0ro/ lia#ili!$
bad condition. upon the carrier a.Na!ural Disas!er
to prove that
the loss was Rele'an! "ro'isions:
due to accident
or some other ivil ode, Article -0? ( ). Co//on carriers are res"onsi#le 0or !e loss8
circumstance (es!ruc!ion8 or (e!eriora!ion o0 !e )oo(s8 unless !e sa/e is (ue !o  any of 
inconsistent the following causes only:

>4  of ,- 
() ;loo(8 s!or/8 ear!&ua9e8 li)!nin)8 or o!er na!ural (isas!er or  Acci(en! (ue !o (e0ec!s o0 carrier no! caso 0or!ui!o .== Accidents caused either
cala/i!$ by defects in the carrier or through the negligence of the carrier is not caso fortuito.
1he passenger or shipper has every right to presume that the carrier is perfectly in
ivil ode, Article -03 . In or(er !a! !e co//on carrier /a$ #e e<e/"!e( good condition and could transport him safely and securely to his destination
0ro/ res"onsi#ili!$8 !e na!ural (isas!er /us! a'e #een !e "ro<i/a!e an(
onl$ cause o0 !e loss. ;owever, the co//on carrier /us! e<ercise (ue Cases:
(ili)ence !o "re'en! or /ini/i+e loss #e0ore8 (urin) an( a0!er !e A!& 11+& 2A1! ;&+B B1R/& +A!!
occurrence o0 0loo(8 s!or/ or o!er na!ural (isas!er  in order that the common /1&!
carrier may be exempted from liability for the loss, destruction, or deterioration of the 1an hiong v. 1an hiong Befendant  According to
goods. 1he same duty is incumbent upon the common carrier in case of an act of the nchausti claims that the company not  Article 0> of 
public enemy referred to in article -0?, /o. 5. defendant liable. the ode of  
company is Befendant, his ommerce,
ode of ommerce, Article 0>. %erchandise shall be transported at the ris9 and liable to him for agents and the merchandise
venture of the shipper, if the contrary has not been expressly stipulated. As a the loss of the patron did ta9e shall be
conseCuence, all !e losses an( (e!eriora!ions 2ic !e )oo(s /a$ su00er goods allegedly the measures transported at
(urin) !e !rans"or!a!ion #$ reason o0 0or!ui!ous e'en!8 0orce /a7eure or belonging to which they the ris9 and
!e ineren! na!ure an( (e0ec! o0 !e )oo(s8 sall #e 0or !e accoun! an( him which he deemed venture of the
ris9 o0 !e si""er . Proof of these accidents is incumbent upon the carrier. delivered to the necessary and shipper, unless
latter to be proper in order the contrary be
Rele'an! A)#a$ani No!es: shipped to ng to save the expressly
E00ec! o0 Ne2 Ci'il Co(e.== 1ransportation of the merchandise Nat the ris9 and "ieng !ip in lorcha and its stipulated. /o
venture of the shipperN means that the shipper will suffer losses and deterioration atarman. cargo from the such stipulation
arising from fortuitous event, force ma#eure, or inherent nature and defects of the ;owever, in the impending appears of  
goods. t does not mean that the carrier is free from liability for losses and contact or the dangerE record,
deterioration arising from his negligence or fault, w$c is presumed. 1hus construed, bill of lading, accordingly, therefore, all
par.  of Art. 0> is not inconsistent with Art. -04 of the /. nothing was the patron, as damages and
said that the soon as he impairment
Re&uisi!es 0or (e0ense o0 na!ural (isas!er: goods will first was informed suffered by the
. Art. -03 66 natural disaster must have been the proximate and only cause of the be shipped by that a storm goods in
loss !orsogon and was transportation,
5. 1he  must exercise due diligence to prevent or minimi8e the loss before, during that transferred approaching, by reason of 
and after the occurrence of f lood, storm, or other natural disaster. f the  does not to a lorcha. proceeded to accident, force
exercise due diligence in minimi8ing the loss, he may yet be held liable /evertheless, it clear the boat ma#eure, or by
notwithstanding the fact that the loss, destruction or deterioration of the goods arose was found that of all gear virtue of the
out of natural disaster. the shipper which might nature or defect
0. Art. -?@ 66 the  must not be in delay. f the  incurs in delay, a natural F/& of this offer resistance of the articles,
disaster shall not free it from responsibility. 'nder Art. >4 par. 0, if the obligor transfer. "efore to the wind, are for the
incurs delay, he shall be responsible for any fortuitous event until he has effected the said lorcha dropped the ? account and ris9 
delivery. could leave for anchors he of the shipper.
;owever, if between the delay or refusal of the  to transport the goods and the its destination, had, and even
loss of the goods due to an act of od there intervened the shipperMs negligence, thus the lorcha was procured an
causing a brea9 in the chain of causation between the act of od which caused their dragged and extra anchor
loss and the Ms fault, the act of od is the proximate cause of the loss and the driven, by the from the land,
carrierMs delay or refusal to transport the goods, is merely the remote cause. n such force of a together with
cases, the shipper is not even entitled to set up the claim of contributory negligence. storm, upon the a new cable,
t is then necessary that it be established that the  was guilty of a willful or shore. and cast it
negligent act and that between this willful or negligent act and the act of od, no into the water,
negligence on the part of the shipper intervened. thereby
adding, in so
>:  of ,- 
 far as cargoes, each their business  Article -04 of 
possible, to insured. %$! and for reasons the ivil ode
the stability  Asiatica caught of public policy, provides that all
and security of  fire and san9. are bound to cases than those
the craft. 1his resulted to observe mention in
%artini v. %artini shipped %acondray 1he carrier is the loss of the extraordinary  Article -0?, the
%acondray on board the cannot be held responsible for ship and its diligence in the common carrier
steamship liable for the the safe and cargoes. 1he vigilance over shall be
&astern 53 damages proper storage respective goods, presumed to
cases of   sustained. of the cargo, nsurers paid according to all have been at
chemicals . !hip n this case, and there is no the the fault or to have
is owned by %artini as the doubt that by corresponding circumstances acted
&astern and shipper the general marine of each case. negligently,
 Australian consented to maritime law he insurance unless it proves
!teamship the conditions is bound to values. that it has
ompany of the carriage, secure the cargo Petitioner observed the
whose agent in it had the safely under contends that it extraordinary
the Philippines burden of proof  dec9. f he is not liable on deligence
was defendant of showing that carries the the ground that reCuired by law.
%acondray. the damage goods on dec9  the loss was
!hipment was was due to the without the due to an
damaged by fault of   consent of the extraordinary
rain and %acondray. t shipper and the fortuitous
seawater. was apparent goods are event.
%artiniDs that the damaged or lost
arguments:it damage here as a #. Ac! o0 "u#lic ene/$
never gave its was caused by conseCuence of 
consent for the rain and sea being exposed, Rele'an! "ro'isions:
goods to be water (the ris9  the carrier
carried on dec9. of which is cannot protect ivil ode, Article -0? (5). Co//on carriers are res"onsi#le 0or !e loss8
inherently himself by (es!ruc!ion8 or (e!eriora!ion o0 !e )oo(s8 unless !e sa/e is (ue !o  any of 
incident to showing that the following causes only:
carriage on they were 546Ac! o0 !e "u#lic ene/$ in 2ar8 2e!er in!erna!ional or ci'il
dec9). damages or lost
by the dangers ivil ode, Article -03. In or(er !a! !e co//on carrier /a$ #e e<e/"!e(
of the sea. 0ro/ res"onsi#ili!$8 !e na!ural (isas!er /us! a'e #een !e "ro<i/a!e an(
;owever, when onl$ cause o0 !e loss . ;owever, the co//on carrier /us! e<ercise (ue
the shipper (ili)ence !o "re'en! or /ini/i+e loss #e0ore8 (urin) an( a0!er !e
consents to his occurrence o0 0loo(8 s!or/ or o!er na!ural (isas!er  in order that the common
goods being carrier may be exempted from liability for the loss, destruction, or deterioration of the
carried on dec9, goods. 1he same duty is incumbent upon the common carrier in case of an act of the
he ta9es the ris9  public enemy referred to in article -0?, /o. 5.
upon himself.
&astern  A vessel Petitioner is  As the peril of  Rele'an! A)#a$ani No!es:
!hipping v. operated by liable. 'nder the fire is not  Ac!s o0 "u#lic ene/$.== 1his defense is not absolute. 'nder -03, in order for the
A petitioner the ivil ode, comprehended  to be exempted from liability, () the act of the public enemy must have been the
&astern common within the proximate and only causeE and (5) the  must have exercised due diligence to
!hipping +ines carriers, from exception in prevent or minimi8e the loss before, during and after the act of the public enemy
loaded different the nature of   Article -0?, causing the loss, destruction or deterioration of the goods.

>>  of ,- 
 overnment 1he tiles were Befendant 'nder the provisions
c. Ac! or o/ission o0 si""er v. Gnchausti delivered by the not liable. of article 0> the
Rele'an! "ro'isions: defendant to the &ach bill of defendant, in order to
consignee of the lading is a free itself from
ivil ode, Article -0?(0). Co//on carriers are res"onsi#le 0or !e loss8 plaintiff at loilo. contract and liability, was only
(es!ruc!ion8 or (e!eriora!ion o0 !e )oo(s8 unless !e sa/e is (ue !o  any of  'pon delivery it the parties obliged to prove that
the following causes only: was found that thereto are the damages suffered
(6 Ac! or o/ission o0 !e si""er or o2ner o0 !e )oo(s E some of the tiles bound by its by the goods were
had been terms. Nby virtue of the
ivil ode, Article -?. I0 !e si""er or o2ner /erel$ con!ri#u!e( !o !e damaged. 1he 2inding that nature or defect of
loss8 (es!ruc!ion or (e!eriora!ion o0 !e )oo(s8 !e "ro<i/a!e cause !ereo0  defendant proved the tiles in the articles.N 'nder
#ein) !e ne)li)ence o0 !e co//on carrier8 !e la!!er sall #e lia#le in that the roofing Cuestion the provisions of
(a/a)es, which however, shall be eCuitably reduced. tiles in Cuestion were shipped article 0>5 the
were of a brittle at the plaintiff, in order to
Rele'an! A)#a$ani No!es: and fragile ownerMs ris9, hold the defendant
 Ac! or o/ission o0 !e si""er 66 1he act or omission of the shipper must be the natureE that they under the liable, was obliged to
proximate cause of the loss, destruction or deterioration of the goods. f the shipper were delivered by law in this prove that the
merely contributed to the loss,etc. and the proximate cause is still the negligence of  the plaintiff to the  #urisdiction, damages to the
the , the  shall still be liable for damages although the damages shall be defendant in the carrier is goods by virtue of
eCuitably reduced. bundles of ten only liable their nature, occurred
each, tied with where the on account of its
be#uco  rattanQ, evidence negligence or
(.Carac!er o0 )oo(s without any shows that because the
pac9ing or he was guilty defendant did not
Rele'an! "ro'isions: protective of some ta9e the precaution
covering. negligence usually adopted by
ivil ode, Article -0?(?  6. Co//on carriers are res"onsi#le 0or !e loss8 and that the careful persons.
(es!ruc!ion8 or (e!eriora!ion o0 !e )oo(s8 unless !e sa/e is (ue !o  any of  damages
the following causes only: claimed were
  (?) Te carac!er o0 !e )oo(s or (e0ec!s in !e "ac9in) or in !e the result of
con!ainers such
negligence.
ivil ode, Article -?5 . E'en i0 !e loss8 (es!ruc!ion8 or (e!eriora!ion o0 !e !outhern ity of loilo !+ liable. 'nder the ode of
)oo(s soul( #e cause( #$ !e carac!er o0 !e )oo(s8 or !e 0aul!$ na!ure +ines v. A reCuisitioned rice !outhern ommerce Art. 0>,
o0 !e "ac9in) or o0 !e con!ainers8 !e co//on carrier /us! e<ercise (ue from /AR in +ines denies defendant6carrier in
(ili)ence to forestall or lessen the loss. %anila. /AR liability by order to free itself
shipped ,-5> saying that from liability, was
Rele'an! A)#a$ani No!es: sac9s of rice on the shortage only obliged to prove
laims for damages must be made at the time the goods are delivered unless the board !! eneral was due to that the damages
indications of the damage cannot be ascertained from the exterior of the pac9age, in right owned by the suffered by the goods
which case such written claims must be made w$in 5? hours from delivery petitioner shrin9age, were Iby virtue of the
Rule: As long as the damage to the goods was due purely to the inherent nature or !outhern +ines. lea9age, nature or defect of
defect of the goods or of the containers thereof, the  cannot be held responsible. ity of loilo spillage of the articles.J 
;owever, under -?5, the  must exercise due diligence to forestall or lessen the received the the rice on 'nder Art. 0>5, the
loss for it to completely escape liability. shipment and account of plaintiff, in order to
paid the shipment the bad hold the defendant6
Cases: cost. ;owever, condition of carrier liable, was
A!& 11+& 2A1! ;&+B B1R/& +A!! they indicated in the sac9s. obliged to prove that
/1&! the bill of lading 1he court the damages to the

>  of ,- 
 that the shipment disagreed goods by virtue of "asilio Rub, ordered
was short. because it their nature, occurred captain /i8a to dump the
nevertheless on account of the scrap iron into the sea.
accepted the defendant6carrierDs
shipment negligence or
with because the .Dura!ion o0 E<!raor(inar$ Res"onsi#ili!$
9nowledge of  defendant did not
the alleged ta9e the precaution Rele'an! "ro'isions:
bad adopted by careful ivil ode, Article -0>. 1he e<!raor(inar$ res"onsi#ili!$ o0 !e co//on
condition of persons. carrier las!s 0ro/ !e !i/e !e )oo(s are uncon(i!ionall$ "lace( in !e
the sac9s. "ossession o08 an( recei'e( #$ !e carrier 0or !rans"or!a!ion un!il !e sa/e
are (eli'ere(8 ac!uall$ or cons!ruc!i'el$8 #$ !e carrier !o !e consi)nee8 or
e.Or(er o0 co/"e!en! au!ori!$ !o !e "erson 2o as a ri)! !o recei'e !e/ , without pre#udice to the
Rele'an! "ro'isions: provisions of article -07.
ivil ode, Article -0?(4). Co//on carriers are res"onsi#le 0or !e loss8
(es!ruc!ion8 or (e!eriora!ion o0 !e )oo(s8 unless !e sa/e is (ue !o  any of  ivil ode, Article -0-. 1he co//on carriers (u!$ !o o#ser'e e<!raor(inar$
the following causes only: (ili)ence o'er !e )oo(s re/ains in 0ull 0orce an( e00ec! e'en 2en !e$
(4) Or(er or ac! o0 co/"e!en! "u#lic au!ori!$ . are !e/"oraril$ unloa(e( or s!ore( in !ransi!8 unless !e si""er or o2ner
as /a(e use o0 !e ri)! o0 s!o""a)e in !ransi!u .
ivil ode, Article -?0 . I0 !rou) !e or(er o0 "u#lic au!ori!$ !e )oo(s are
sei+e( or (es!ro$e(8 !e co//on carrier is no! res"onsi#le8 "ro'i(e( sai( ivil ode, Article -07. 1he e<!raor(inar$ lia#ili!$ o0 !e co//on carrier
"u#lic au!ori!$ a( "o2er !o issue !e or(er. con!inues !o #e o"era!i'e even during the time the goods are stored in a
warehouse of the carrier at the place of destination, un!il !e consi)nee as #een
Rele'an! A)#a$ani No!es: a('ise( o0 !e arri'al o0 !e )oo(s an( as a( reasona#le o""or!uni!$
Or(er or ac! o0 co/"e!en! au!ori!$== 'nder -?0, the  is not responsible for !erea0!er !o re/o'e !e/ or o!er2ise (is"ose o0 !e/ .
the loss, etc. of the goods if the public authority had power to issue the order. here
the officer acts without legal process, the  will be held liable. Rele'an! A)#a$ani No!es:
Wen carriers res"onsi#ili!$ #e)ins== 'nder Art.-07, the extra6ordinary
Cases: responsibility of the  begins from the time the goods are delivered to the carrier.
A!& 2A1! ;&+B B1R/& +A!! 1he delivery to the  must place the goods to be transported unconditionally in the
11+& /1&! possession of the  and the  must receive them. therwise, the extra6ordinary
an8on 1umambing contracted  Acting t must be shown responsibility of the  will not commence.
v. ourt the services of %auro %ayorDs that the person had
of an8on to haul 0@4 tons order was the power to issue Wen carriers res"onsi#ili!$ !er/ina!es== 'nder -07, the extra6ordinary
 Appeals of scrap iron on board the not one by the disputed order, responsibility of the  is terminated at the time the goods are delivered to the
lighter +1 N"atmanN. a or that it was consignee or the person who has a right to receive them (actual or constructive
hen about half of the competent lawful, or that it delivery).
scrap iron was already authority. was issued under onstructive delivery: /otice by the  that the cargo had already arrived, placing
loaded, %ayor <ose legal process of them at the disposal of the shipper or consignee releases  from extra6ordinary
 Advincula of %ariveles authority responsibility. 2rom such moment the consignee or shipper should exercise over the
arrived and demanded cargo the ordinary control pertinent to ownership (should unload cargo from the )
P4,@@@.@@ from
1umambing. 1umambing Si""er #oun( !o o#ser'e all (ili)ence in o#!ainin) (eli'er$ o0 )oo(s== 1he
resisted the sha9edown shipper is bound to observe all diligence in obtaining delivery of the goods. nce the
and after a heated goods are delivered, the extra6 ordinary responsibility of the  ceases.
argument between them,
%ayor Advincula drew his Lia#ili!$ o0 si""er 0or (ela$ in o#!ainin) (eli'er$ o0 )oo(s8 (e/urra)e==
gun and fired at 1he shipper is liable for lost earnings occasioned by the unnecessary delay in the use
1umambing Acting %ayor of the vehicles belonging to the carrier, due in turn to the failure of the former, upon

>?  of ,- 
receipt of notice of the arrival of the goods at the place of destination, to unload "inamira ompany of /ew carrier cargo to the
forthwith and ta9e away the cargo from the vehicles. 1his is a charge for demurrage.  Gor9 shipped on responsible consignee (or person
board the %$! for the loss who has a right to
E00ec! o0 s!orin) in !ransi!== 'nder -0-, the temporary unloading or storage of  N2&R/!B&N at /ew considering receive them) is what
the goods during the time that they are being transported does not interrupt the  Gor9, > cases of films that the is contemplated in
extra6ordinary responsibility of the  and$or photographic same  Art. -0>, when
&xception: here the shipper or owner exercises its right of stoppage in transitu (the supplies consigned to occurred goods are still in the
act by which the unpaid vendor of goods stops their progress and resumes the order of . . after the hands of the
possession of them, while they are in the course of transit from him to the purchaser, "inamira. +u Bo, as shipment overnment wherein
and not yet actually delivered to the latter. 1his is exercised when the buyer is or agent of the carrier, was the owner cannot
becomes insolvent.) hired the ebu discharged exercise dominion,
!tevedoring from the parties may agree to
Res"onsi#ili!$ o0 carrier 2en ri)! e<ercise(== 1he extra6ordinary responsibility ompany, nc. to ship and limit the liability of 
of the  ceases when the goods being transported are temporarily unloaded or unload its cargo. All placed in the carrier
stored in transit be reason of the exercise of the right of stoppage in transitu by the the cargo unloaded the considering that the
unpaid seller. 1he  holds the goods in the capacity of an ordinary bailee or was received at the possession goods still have to go
warehouseman upon the theory that the exercise of the right of stoppage in transitu  pier by the arrastre and through the
terminates the contract of carriage (ordinary diligence is reCuired) operator of the port. custody of  inspection of the
1he terminal the customs authorities
E00ec! o0 s!ora)e in 2areouse o0 carrier.==   'nder -07, the extra6ordinary company had its own customs before they are
responsibility of the  does not cease notwithstanding the fact that the goods being chec9er who also authorities* actually turned over
transported are stored in the warehouse of the  at the place of destination. &xtra6 recorded and noted /. to the consignee. 1his
ordinary responsibility ceases only after the consignee has been advised of the arrival down the good cargo is a situation where
of the goods and has had reasonable opportunity to remove them or otherwise from the bad one.1he we the carrier losses
dispose of them. shipment in Cuestion, control of the goods
+iability as a warehouseman (ordinary diligence) arises only when the consignee has was not included in because of a custom
been advised of the arrival of the goods and has had reasonable opportunity to the report of bad regulation. t is unfair
remove them or otherwise dispose of them order cargo of both that it be made
chec9ers. ;e responsible for what
Cases: discovered that the may happen during
A!& 2A1! ;&+B B1R/& +A!! cases showed signs the interregnum.
11+& /1&! of pilferage and he
ompania %acleod contracted % is liable. 1he liability and hired marine
%aritima the services of the responsibility of the surveyors to examine
v. ompaUia %aritima carrier under a them.
nsurance for shipment of 5,>?4 contract for the  AP+ v Flepper shipped on !hipper is
ompany bales of hemp.+1 carriage of goods Feppler board the !. !. liable.
/o. @54 san9, commence on President leveland
resulting in the their actual delivery at Go9ohama, <apan
damage. %acleod to , or receipt by , the one lift van. hile the
filed a claim for the carrier or an lift van was being
loss it suffered with authori8ed agent . ... unloaded, it fell on
the insurance and delivery to a the pier and its
company. lighter in charge of a contents were spilled
vessel for shipment and scattered.
on the vessel, where !amar !amar %ining /+ is liable.  -0> is the
it is the custom to %ining v. ompany imported  1he extent applicable provision.
deliver in that way. /ordeutsc crate of ptima if   Actual delivery has
+u Bo v . Belta Photo !upply s the hile delivery of the her +loyd welded wedge wire /ordeutrsc been defined as the

>  of ,- 
 sieves from ermany herDs ceding of corporeal (0) 1hat the co//on carrier nee( no! o#ser'e an$ (ili)ence  in the custody of 
through a vessel liability in possession by the the goodsE
owned by the seller, and the actual (?) 1hat the co//on carrier sall e<ercise a (e)ree o0 (ili)ence less !an
/ordeutrscher +loyd. transshipm apprehension of  !a! o0 a )oo( 0a!er o0 a 0a/il$8 or o0 a /an o0 or(inar$ "ru(ence in !e
'pon arrival of the ent is corporeal possession 'i)ilance o'er !e /o'a#les  transportedE
vessel at the port of  embodied by the buyer or by (4) 1hat the co//on carrier sall no! #e res"onsi#le 0or !e ac!s or o/ission
%anila, the is provided some person o0 is or i!s e/"lo$eesE
importation was for in the authori8ed by him to (>) 1hat the co//on carriers lia#ili!$ 0or ac!s co//i!!e( #$ !ie'es8 or o0 
unloaded and same bill of  receive the goods as ro##ers 2o (o no! ac! 2i! )ra'e or irresis!i#le !rea!8 'iolence or 0orce8
delivered in good lading.1he his representative for is (is"ense( 2i! or (i/inise(E
order and condition to ! in this the purpose of   (-) 1hat !e co//on carrier is no! res"onsi#le 0or !e loss8 (es!ruc!ion8 or
the bonded case upheld custody or disposal. (e!eriora!ion o0 )oo(s on accoun! o0 !e (e0ec!i'e con(i!ion o0 !e car8
warehouse of A%G+. the validity 'eicle8 si"8 air"lane or o!er e&ui"/en! use( in !e con!rac! o0 carria)e .
1he goods w ere of 
however never stipulations ivil ode, Article -4. 1he 0ac! !a! !e co//on carrier as no co/"e!i!or
delivered to, nor in bills of  alon) !e line or rou!e8 or a "ar! !ereo08 !o 2ic !e con!rac! re0ers sall
received by, the lading #e !a9en in!o consi(era!ion on !e &ues!ion o0 2e!er or no! a s!i"ula!ion
consignee at Bavao, exempting li/i!in) !e co//on carriers lia#ili!$ is reasona#le , #ust and in consonance
its port of destination. the carrier with public policy.
from
liability for #. As !o a/oun! o0 lia#ili!$
loss or
damage to Rele'an! "ro'isions:
the goods
when the ivil ode, Article -?3 .  A s!i"ula!ion !a! !e co//on carriers lia#ili!$ is
same are li/i!e( !o !e 'alue o0 !e )oo(s a""earin) in !e #ill o0 la(in)8 unless !e
not in its si""er or o2ner (eclares a )rea!er 'alue8 is #in(in).
actual
custody. ivil ode, Article -4@.  A con!rac! 0i<in) !e su/ !a! /a$ #e reco'ere(. #$
!e o2ner or si""er 0or !e loss8 (es!ruc!ion8 or (e!eriora!ion o0 !e )oo(s
>.A)ree/en! Li/i!in) Lia#ili!$ is 'ali( , i0 i! is reasona#le an( 7us! un(er !e circu/s!ances8 an( as #een
a. As !o !e (ili)ence re&uire( 0airl$ an( 0reel$ a)ree( u"on .

Rele'an! "ro'isions: Cases:

ivil ode, Article -?? . A s!i"ula!ion #e!2een !e co//on carrier an( !e A!& 2A1! ;&+B B1R/& +A!!
si""er or o2ner li/i!in) !e lia#ili!$ o0 !e 0or/er 0or !e loss8 11+& /1&!
(es!ruc!ion8 or (e!eriora!ion o0 !e )oo(s !o a (e)ree less !an ;eacoc9 v. Plaintiff caused to be arrier may 1hree 9inds of
e<!raor(inar$ (ili)ence sall #e 'ali( , provided it be: %acondray delivered four cases of limit liability stipulations often
() In 2ri!in)8 si)ne( #$ !e si""er or o2ner E merchandise on board by made in a bill of
(5) Su""or!e( #$ a 'alua#le consi(era!ion o!er !an !e ser'ice ren(ere( of steamship "olton stipulation lading: ()
#$ !e co//on carrier E and astle. ne of the exempting the
(0) Reasona#le8 7us! an( no! con!rar$ !o "u#lic "olic$ . cases contained 5 76 carrier from any
day &dmond cloc9s, and all liability for
ivil ode, Article -?4.  Any of the 0ollo2in) or si/ilar s!i"ula!ions sall #e boxed and mar9ed for loss or damage
consi(ere( unreasona#le8 un7us! an( con!rar$ !o "u#lic "olic$ : transportation to occasioned by its
() 1hat the )oo(s are !rans"or!e( a! !e ris9 o0 !e o2ner or si""er E %anila. 1he freight own negligence, (5)
(5) 1hat the co//on carrier 2ill no! #e lia#le 0or an$ loss8 (es!ruc!ion8 or was paid in advance. providing for an
(e!eriora!ion o0 !e )oo(s E 1he steamship arrived unCualified
in the port of %anila, limitation of such
>  of ,- 
 consigned to the liability to an suitcase arrived in common conditions as
defendant. /either the agreed valuation, %anila, he was carrier may, printed at the bac9 
master of said vessel and (0) limiting the informed by the acting by contract, of the tic9et stub.
nor the defendant liability of the station agent of the be limited to 1he fact that those
delivered to the carrier to an agreed %anila airport of the a fixed conditions are
plaintiff the &dmond valuation unless arrival of his suitcase, amount. printed at the bac9 
cloc9s, although the shipper but minus his ;owever, it of the tic9et stub in
demand was made for declares a higher 1ransistor Radio - and is reCuired letters so small that
their delivery.1he bill value and pays a the Rollflex that the they are hard to
of lading issued and higher rate of amera.Appellant: its contract read would not
delivered to the freight. According liability should be must be warrant the
plaintiff by the master to an almost limited to the amount Nreasonable presumption that
of the steamship uniform weight of stated in the and #ust the appellee was
contained that:. t is authority, the first conditions of carriage under the aware of those
mutually agreed that and second 9inds printed at the bac9 of  circumstance conditions such
the value of the goods of stipulations, the plane tic9et stub s and has that he had Nfairly
receipted for above which either which was issued to been fairly and freely agreedN
does not exceed V4@@ exempt the carrier the appellee, which and freely to those conditions.
per freight ton, or, in from liability for conditions are agreed
proportion for any part loss or damage embodied in Bomestic upon.N
of a ton, unless the occasioned by its 1ariff Regulations /o.
value be expressly negligence, or 5 which was filed with
stated herein and ad provide for an the ivil Aeronautics
valorem freight paid unCualified "oard.
thereon. Also, that in limitation of such ng Giu v. Petitioner w as a 1he liability hile it may be
the event of claims for liability to an ourt of  passenger of PA+. ;e of PA+ for true that petitioner
short delivery of, or agreed valuation,  Appeals was scheduled to the loss, in had not signed the
damage to, cargo are invalid as being attend a trial.;e accordance plane tic9et, he is
being made, the contrary to public chec9ed in one piece with the nevertheless bound
carrier shall not be policy. 1he third, of luggage for which stipulation by the provisions
liable for more than however, is valid he was issued laim written on thereof. t is what
the net invoice price and enforceable. hec9 /o. 5@>6R. the bac9 of  is 9nown as a
plus freight and 1he present case 'pon arrival, petitioner the tic9et is contract of  
insurance less all falls within the third claimed his luggage, limited to NadhesionN, in
charges saved, and stipulation. but it could not be P@@.@@ per regards which it
any loss or damage for found. t was only baggage, has been said that
which the carrier may after reacting plaintiff not contracts of  
be liable shall be indignantly to the loss having adhesion wherein
ad#usted pro rata on that the matter was declared a one party imposes
the said basis. attended to by the greater a ready made form
!hewaram Parmanand !hewaram +iability is 1he reCuirements porter cler9. Petitioner value, and of contract on the
v. PA+ was a passenger on not of said article have was worried about the not having other, as the plane
defendantMs aircraft, restricted to not been met. t missing luggage called the tic9et in the case at
;e chec9ed in 0 pieces the amount cannot be said that because it contained attention of  bar, are contracts
of baggages . 1he on the bac9  the appellee had vital documents the not entirely
suitcase was of the stub. actually entered needed for trial the defendant prohibited. 1he one
mistagged by 1he into a contract with next day. Bagorro then on its true who adheres to the
defendantMs personnel. pecuniary the appellant, delivered the NmaletaN value and contract is in reality
hen the plaintiffMs liability of a embodying the to petitioner, with the paid the free to re#ect it

>  of ,- 
 information that the tariff  entirelyE if he the preparation of the that the passenger
loc9 was open. 'pon therefor. adheres, he gives reCuisite promotional was aware of the
inspection, petitioner 1he validity his consent. handbills and still conditions and that
found that a folder of this pictures. Pangan in his he had freely and
containing certain stipulation is two luggages, for fairly agreed
exhibits, transcripts not which he was given thereto. 1herefore,
and private documents Cuestioned baggage claim tic9ets.
iwere missing, aside by the his two luggages did
from two gift items for plaintiff. not arrive with his
his parents6in6law. 1hey are flight, as a
printed in conseCuence of which
reasonably his agreements with
and fairly big !lutchnic9 and
letters, and Wuesada for the
are easily exhibition of the films
readable. in uam and in the
%oreover, 'nited !tates were
plaintiff had cancelled.
been a athay 1omas Alcantara was a A1;AG  1he arsaw
freCuent Pacific v. first6class passenger of  argues that onvention does
passenger of  A athay Pacific. ;e was the extent of  not operate as an
PA+ from on his to meet with the its liability exclusive
ebu to Birector eneral of  should be enumeration of the
"utuan ity 1rade of ndonesia in limited to instances for
and bac9, his capacity as an that set forth declaring a carrier
and he, official in the Philippine in the liable for breach of 
being a cement industry. ;e arsaw contract of carriage
lawyer and chec9ed in his luggage onvention or as an absolute
businessman which he later  / limit of the extent
, must be discovered was of its liability, t
fully aware missing.1he A1;AG  does not preclude
of these rep said to him, Ihat the operation of 
conditions. can we do, the the ivil ode and
baggage is missing.  other laws, and
Pan Am v. Rene . Pangan, arrierDs 1he ruling in cannot do anythingX does not regulate
A president and general liability is !hewaram v.  Anyhow you can buy the carrier from
manager of the limited. Philippine Air +ines  anything you need,J  liability for
plaintiffs !otang petitionerMs finds no application and was offered damages for
"astos and Archer liability for in the instant case. V5@.@@ as violating the rights
Production and Primo the lost 1he ruling in said  Iinconvenience of passengers,
Wuesada of Prime baggage is case was premised moneyJ. especially for wilful
2ilms, !an 2rancisco, limited to on the finding that misconduct of its
alifornia, entered into V5@.@@ per the conditions agents.
an agreement. 1he 9ilo or printed at the bac9 
former bound himself  V>@@.@@, as of the tic9et were c. As !o (ela$ in (eli'er$
to supply the latter stipulated at so small and hard
with three films for the bac9 of  to read that they Cases:
exhibition in the 'nited the tic9et. would not warrant A!& 11+& 2A1! ;&+B B1R/& +A!!
!tates. Pangan caused the presumption /1&!
-  of ,- 
%aers9 +ine %aers9 +ine is arrier is liable. hile it is true
v. A engaged in the n the case that common ivil ode, Article, -?-. I0 !e co//on carrier8 2i!ou! 7us! cause8 (ela$s !e
transportation of  before us, we carriers are not !rans"or!a!ion o0 !e )oo(s or can)es !e s!i"ula!e( or usual rou!e, the
goods by find that a delay obligated by con!rac! li/i!in) !e co//on carriers lia#ili!$ canno! #e a'aile( o0  in case
sea.&fren in the delivery of  law to carry of the loss, destruction, or deterioration of the goods.
astillo, ordered the goods and to deliver
from &li +illy. spanning a merchandise, ivil ode, Article -?7.  An a)ree/en! li/i!in) !e co//on carriers lia#ili!$
nc. of Puerto period of two (5) and persons are 0or (ela$ on accoun! o0 s!ri9es or rio! s is 'ali(.
Rico >@@,@@@ months and not vested with
empty gelatin seven (-) days the right to ivil ode, Article -4.  1he 0ac! !a! !e co//on carrier as no co/"e!i!or
capsules for the falls was beyond prompt alon) !e line or rou!e8 or a "ar! !ereo08  to which the contract refers shall be
manufacture of  the realm of   delivery, unless !a9en in!o consi(era!ion on !e &ues!ion o0 2e!er or no! a s!i"ula!ion
his reasonableness. such common li/i!in) !e co//on carriers lia#ili!$ is reasona#le , #ust and in consonance
pharmaceutical carriers with public policy.
products. 2or previously
reasons assume t he ivil ode, Article -45. E'en 2en !ere is an a)ree/en! li/i!in) !e lia#ili!$
un9nown, said obligation to o0 !e co//on carrier in !e 'i)ilance o'er !e )oo(s8 !e co//on carrier
cargo of   deliver at a is (is"u!a#l$ "resu/e( !o a'e #een ne)li)en t in case of their loss, destruction
capsules were given date or or deterioration.
mishipped and time, delivery
diverted to of shipment or Rele'an! A)#a$ani No!es:
Richmond, cargo should at 3in(s o0 s!i"ula!ion li/i!in) lia#ili!$.== 1he following stipulations are often made
 irginia, '!A least be made in a bill of lading bill of lading:
and then within a . stipulation exempting the  from any and all liability for loss or
transported bac9  reasonable damage occasioned by its own negligence 6 B
a9land, time. 5. stipulation providing for an unCualified limitation of such liability
aliforilia. 1he hen a to an agreed stipulation 6 B
goods finally common carrier 0. stipulation limiting the liability of the  to an agreed valuation
arrived in the underta9es to unless the shipper declares a higher value and pays a higher rate of 
Philippines on convey goods, freight 66 A+B and &/2R&A"+&
<une @, 3-- or the law implies
after two (5) a contract that Wen s!i"ula!ion li/i!in) lia#ili!$ 'ali( .66 'nder -??, the shipper or owner and
months from the they shall be the  may stipulate to limit the liability of the  for the loss, destruction or
date specified in delivered at deterioration of goods to a degree less than extra6 ordinary diligence :
the destination . the stipulation must be in writing and signed by both partiesE
memorandum. within a 5. the stipulation must be supported by valuable consideration
reasonable other than the service rendered by the E
time, in the 0. the stipulation must be reasonable, #ust and not contrary to
absence, of any public policy. 1his applies only when the  is acting as such but
agreement as not when it acts as a private carrier in ;ome nsurance vs
to the time of   American !teamship o., the ! held that the ivil ode provisions
delivery. on  should not be applied where the  is not acting as such but
as a private carrierE such policy has no force where the public at
large is not involvedQ
(. ;ac!ors a00ec!in) a)ree/en! 1he parties may stipulate that the diligence to be exercised by the
Rele'an! "ro'isions:  be less than extra6ordinary diligence, provided that the
ivil ode, Article -?>.  An a)ree/en! li/i!in) !e co//on carriers lia#ili!$ reCuirements under Article -?? are complied with. ;owever, the
/a$ #e annulle( #$ !e si""er or o2ner i0 !e co//on carrier re0use( !o parties cannot reduce the diligence to less than that of a good
carr$ !e )oo(s unless !e 0or/er a)ree(  to such stipulation.

, of ,- 
 father of a family. Art. -?4 provides for - stipulations which shall  in the vigilance of the goods. 1his presumption is disputable or rebuttable by
be considered unreasonable, un#ust and contrary to public policy. evidence that the  exercised extra6ordinary diligence.

Cons!r
Cons!ruc!
uc!ion
ion o0 s!i"ul
s!i"ula!i
a!ions
ons li/i!i
li/i!in)
n) co//on
co//on carrie
carriers
rs lia#i
lia#ili!$.===  An
li!$.= .A""lica#le la2 in 0orei)n !ra(e
exemption in general words not expressly relating to negligence, even though the Rele'an! "ro'isions:
words are wide enough to include loss by negligence or default of Ms servants,
must be construed as limiting the liability of the  as assurer, and not as relieving ivil ode, Article -40. 1he la2 o0 !e coun!r$ !o 2ic !e )oo(s are !o #e
him from the duty of exercising reasonable s9ill and care !rans"or!e(
!rans"or!e( sall )o'ern
)o'ern !e lia#ili!$ carrier  for their loss,
lia#ili!$ o0 !e co//on carrier
destruction or deterioration.
E00ec! co/"e!i!or !o co//on carrier.=='nder -4, the lac9 of 
E00ec! o0 lac9 o0 co/"e!i!or
competition of the  shall be considered in determining / a stipulation limiting Rele'an! A)#a$ani No!es:
Ms liability is reasonable, #ust and in consonance with public policy. 1he ivil ode governs the liability of the  in case of loss, damage or deterioration.
'nder ->>, in all matters not regulated by the ivil ode, the rights and obligations
E<a/"les o0 'ali( s!i"ula!ions: of  shall be governed by the ode of ommerce and by special laws which are
. -?7 6 an agreement limiting the Ms liability for delay on suppletory to the provisions of the ivil ode.
account of stri9es or riots
5. -?3, ;eacoc9 vs %acondray 6 a stipulation that the Ms liability ?.Rules
?.Rules on "assen)er #a))a)e
is limited to the value of the goods appearing in bill of lading unless Rele'an! "ro'isions:
the shipper or owner declares a greater value ivil ode, Article -4?.  1he "ro'isions o0 ar!icles , !o , sall a""l$ !o
0. -4@ 6 a contract fixing the sum that may be recovered by the !e "assen)ers #a))a)e 2ic is no! in is "ersonal cus!o($ or in !a! o0 
owner or shipper for the loss, destruction or deterioration of the is e/"lo$ee . As to o!er #a))a)e8 !e rules in ar!icles , an( 4--- !o
goods, if it is reasonable and #ust under the circumstances, and has 4--  concerning the responsibility of hotel69eepers shall be applicable.
been fairly and freely agreed upon
'nder
'nder -?>,
-?>, an agreem
agreement
ent limiti
limiting
ng the Ms
Ms liabil
liability
ity may
may be ivil ode, Article 337.  1he (e"osi! o0 e00ec!s /a(e #$ !ra'ellers in o!els or
annulled by the shipper or owner if the  refused to carry the inns shall also be re)ar(e( as necessar$. 1he 9ee"ers o0 o!els or inns sall
goods unless the former agreed to such stipulation. 1he effect of  #e res"onsi#le 0or !e/ as (e"osi!aries8 "ro'i(e( !a! no!ice 2as )i'en !o
the shipperMs consent obtained by means of refusal on the part of  !e/8 or !o !eir e/"lo$ees, of the effects brought by the guests and that, on the
the carrier to carry the goods is to ma9e the agreement limiting the part of the latter, they ta9e the precaution
precautionss which
which said hotel69eepe
hotel69eepers
rs or their
Ms liability voidable at the instance of the shipper substitutes advised relative to the care and vigilance of t heir effects. (-70)

Princi"les : !t. Paul nsurance vs %acondray, -@ !RA 55Q ivil ode, Article 5@@@.   1he res"onsi#i
res"onsi#ili!$
li!$ re0erre( !o in !e !2o "rece(in)
"rece(in)
. A stipulation in the bill of lading limiting the Ms liability to the ar!icles sall inclu(e !e loss o08 or in7ur$ !o !e "ersonal "ro"er!$ o0 !e
value of the goods appearing in the bill, unless the shipper or )ues!s cause( #$ !e ser'an!s or e/"lo$ees o0 !e 9ee"ers o0 o!els or
owner declares a greater value, is valid and binding. inns as 2ell as s!ran)ers #u! no! !a! 2ic /a$ "rocee( 0ro/ an$ 0orce
5. 1he insurer who pays the insured on his claim for damage is /a7eure. 1he fact that travellers are constrained to rely on the vigilance of the
merely
merely subrogate
subrogatedd to the rights of the insuredE therefore,
therefore, said 9eeper of the hotels or inns shall be considered in determining the degree of care
insurer cannot collect from the  more than what the insured can reCuired of him. (-7?a)
collect from the .
0. 1he obligation to pay the damage begins from the date it fails to ivil ode, Article 5@@.  1he ac! o0 a !ie0 or ro##er , who has entered the hotel is
deliver the shipment in good condition to the consignee (on the no! (ee/e(
(ee/e( 0orce
0orce /a7eure8
/a7eure8 unless
unless i! is (one
(one 2i!
2i! !e use o0 ar/s or
basis of the rate of exchange on that date). !rou) an irresis!i#le 0orce.
0orce. (n) 

E00ec! o0 (ela$ in !rans"or!a!ion8 e!c .66 'nder -?-, the  cannot avail of the ivil ode, Article 5@@5 . Te o!el=9ee"er is no! lia#le 0or co/"ensa!ion i0 !e
contra
contract
ct limiti
limiting
ng his liabili
liability
ty in these
these cases
cases : () where
where the  delays
delays the loss is (ue !o !e ac!s o0 !e )ues!8 is 0a/il$8 ser'an!s or 'isi!ors8 or i0 !e
transportation of the goodsE (5) where the  changes the stipulated or usual route loss arises 0ro/ !e carac!er o0 !e !in)s  brought into the hotel. (n)
in both cases, the delay or change of route must be without #ust causeQ
ivil
ivil ode,
ode, Articl
Article
e 5@@0.
5@@0. Te o!el=
o!el=9ee
9ee"er
"er canno!
canno! 0ree
0ree i/sel
i/sel00 0ro/
0ro/
Presu/"!ion as !o ne)li)ence in case o0 li/i!e( lia#ili!$.== 'nder -45, the res"onsi#ili!$ #$ "os!in) no!ices !o !e e00ec! !a! e is no! lia#le 0or !e
presumption continues even when there is an agreement limiting the liability of the ar!icles #rou)! #$ !e )ues!.  Any stipulation between the hotel69eeper and the

4  of
 of ,- 
guest whereby the responsibility of the former as set forth in articles 337 to 5@@ is
suppressed or diminished shall be void. ( n)  Rele'an! "ro'isions:
Rele'an! A)#a$ani No!es: ivil ode, Article -00. Co//on carriers8 0ro/ !e na!ure o0 !eir #usiness
Classes
Classes o0 #a))a)e o0 "assen)ers.
"assen)ers.== == 1he law ma9es a distinction between () an( 0or reason
reasons s o0 "u#lic
"u#lic "olic$
"olic$88 are #oun(
#oun( !o o#ser'
o#ser'ee e<!rao
e<!raor(i
r(inar
nar$$
baggage in the custody of the passengers or their &&sE and (5) baggage not in such (ili)ence in the vigilance over the goods and 0or !e sa0e!$ o0 !e "assen)ers
custody but in that of the . !rans"or!e( #$ !e/8 accor(in) !o all !e circu/s!ances o0 eac case.
!uch extraordinary diligence in the vigilance over the goods is further expressed in
Lia#ili!$ 0or #a))a)e in cus!o($ o0 "assen)er.== Art. -4? refers to Arts. 337, articles -0?, -04, and -?4, /os. 4, >, and -, while the extraordinary diligence for
5@@@6 5@@0 concerning the responsibility of hotel 9eepers. 'nder 337, the baggage the safety of the passengers is further set forth in articles -44 and -4>.
of passengers in their personal custody or in that of their &&s while being transported
shall be regarded as necessary
necessary deposits.
deposits. 1he  shall be responsible
responsible for such ivil ode,Article -44 .  A co//on carrier is #oun( !o carr$ !e "assen)ers
baggage as depositaries, provided that () notice was given to them or to their &&s, sa0el$ as 0ar as u/an care an( 0oresi)! can "ro'i(e8 usin) !e u!/os!
of the baggage brought by their passengers, and that (5) the passengers ta9e the (ili
(ili)e
)enc
nce
e o0 'er$
'er$ cau!
cau!io
ious
us "ers
"erson
ons8
s8 2i!
2i! a (ue re)a
re)ar(
r( 0or
0or all
all !e
!e
precautio
precautions
ns which
which said s advised
advised relative to the care and vigilance
vigilance of their circu/s!ances.
baggage.
Rele'an! A)#a$ani No!es:
Res"onsi#ili!$ 0or ac!s o0 EEs8 !ie'es.== 'nder 5@@@, a  is responsible as a Co//on
Co//on carriecarriers
rs /us!
/us! e<erci
e<ercisese e<!rao
e<!raor(i
r(inar
nar$ $ (ili)e
(ili)ence
nce in carr$i
carr$in)
n)
depositary
depositary for the loss of or in#ury to the baggage
baggage in the personal
personal custody
custody of  "assen)ers.== Art. -44 shows clearly the high degree of care and extra6o diligence
passenger
passengers, s, caused by the Ms servants
servants or &&s but not those caused
caused by force reCuired of a  with respect to its passengers.
ma#eure. Carriers (u!$ o0 e<!raor(inar$ (ili)ence e<!en(s also !o cre2 /e/#ers.==
'nder 5@@, the act of a thief or robber, who has entered the Ms vehicle is not 1he duty to exercise the utmost diligence on the part of s is for the safety of 
deemed force ma#eure, unless it is done with the use of arms or through irresistible passengers as well as for the members of the crew or the complement operating the
force. carrier. 1his must be so for any omission, lapse or neglect thereof will certainly result
'nder 5@@5, the  is not liable if the loss of the baggage in the personal custody of  to the damage, pre#udice, in#uries or even death to all aboard the plane.
the passenger is due to the acts of the passengers, his family, servants or visitors, R 
if the loss arises f rom the character of the baggage. Cases:
A!& 2A1! ;&+B B1R/& +A!! /1&!
S!i"ula!io
S!i"ula!ionsns li/i!in)
li/i!in) lia#ili!$.== 'nder
lia#ili!$.== 'nder 5@@0,
5@@0, a  cannot
cannot free himsel
himselff from
from 11+&
responsibility by posting notices to the effect that he is not liable for the baggage saac v. saac paid and / +. Ammen Rules governing Principles
brought by the passengers. Any stipulation diminishing the responsibility reCuired  Al Amnen boarded "us 1ranspo o. has this #urisdiction: governing the
under 337 to 5@@ shall be void. 1ransport /o. 0 of A.+. observed  AR1. -00. liability of a
 Ammen. 1he extraordinary ommon common
Lia#ili!$ "assen)er.== 1his refers to baggage
Lia#ili!$ 0or #a))a)e no! in cus!o($ o0 "assen)er.== bus collided diligence or the carriers, from carrier:
delivered to the custody of the  and received by him, to be carried in the same with a motor utmost diligence the nature of () the liability
manner as other goods being transported by him. As the  has custody of such vehicle. saacDs of every cautious their business of a carrier is
baggage and are carried li9e any other goods, the provisions on carriage of goods left arm was person, having and for reasons contractual and
shall apply (extra6ordinary diligence in the vigilance over the goods). completely due regard for all of public policy, arises upon
1he moment the effects of a passenger are unconditionally placed in the possession severed. circumstances, in are bound to breach of its
of and received by a carrier for conveyance, the law immediately imposes on the  avoiding the observe extra obligation.
extra6ordi
extra6ordinary
nary responsibil
responsibility
ity for the loss thereof
thereof which lasts until the actual or collision which ordinary 1here is breach
constructive delivery of the effects to the passenger as the person who has the right resulted in the diligence in the if it fails to
to receive them (presumption of negligence exists but may be rebutted by proof of  in#ury caused to vigilance over exert
exercise of extraordinary diligence or causes under -0?). the plaintiff. G&!. the goods and extraordinary
 A  is liable for the loss of baggage although not declared
declared and the charges not paid, for the safety of  diligence
if it accepted them for transportation the passengers according to all
transported by circumstances
them according of each caseE
C.Co//on Carria)e o0 Passen)ers to all the (5) a carrier is
,.Na!ure an( e<!en! o0 res"onsi#ili!$ circumstances obliged to carry
:  of
 of ,- 
 of each case. its passenger brea9ing of mountainous, passenger has
 AR1. -44. A with the utmost metal below circuitous and neither the
common carrier diligence of a the floor of the ascending roads. choice nor
is bound to very cautious bus was heard, 1hus the entire control over the
carry the person, having and the bus bus, including its carrier in the
passengers due regard for abruptly mechanical parts, selection and
safely as far as all the stopped, would naturally use of the
human care circumstancesE rolling bac9 a be taxed more eCuipment and
and foresight (0) a carrier is few moments heavily than it appliances in
can provide, presumed to be later. +eonila would be under use by the
using the at fault or to and &strella ordinary carrier.N hen
utmost have acted were not circumstances. a passenger
diligence of negligently in thrown out of 1he mere fact dies or is
very cautious case of death the bus, but that the bus was in#ured, the
persons, with a of, or in#ury to, they panic9ed inspected only presumption is
due regard for passengers, it and #umped recently and that the
all the being its duty out. found to be in common carrier
circumstances. to prove that it order would not is at fault or
 AR1. -4>. n exercised exempt the that it acted
case of death of  extraordinary carrier from negligently
or in#uries to diligenceE and liability unless it (Article -4>).
passengers, (?) the carrier is shown that the 1his
common is not an particular presumption is
carriers are insurer against circumstances only rebutted
presumed to all ris9s of under which the by proof on the
have been at travel. bus would travel carrierMs part
fault or to have were also that it observed
acted considered. the
negligently, Nextraordinary
unless they diligenceN
prove that they reCuired in
observed  Article -00
extraordinary and the
diligence as Nutmost
prescribed in diligence of
articles -00 very cautious
and -44. personsN
+andingin +eonila / Pantranco n +asam vs. reCuired in
v. +andingin and is guilty of !mith, it was  Article -44
Pantranco &strella breach of held that an (Article -4>).
arciawere contract of accident caused
among the carriage. (G&!) by defects in /ecessito /ecesito, 1he ourt is of 1he rule on the
passengers in 1he bus in which the automobile v. Paras together with the opinion that liability of
the bus owned the deceased is not his mother, the carrier did carriers for
and operated were riding was acasofortuito . boarded a not exercise the defects of
by defendant heavily laden 1he rationale of  passenger bus.  Iutmost eCuipment is
PA/1RA/. with passengers, the carrierMs 1he driver lost diligenceJ that thus expressed:
 A sudden and it would be liability is the control. 1he the law reCuires,  I1he
snapping or traversing fact that Nthe carrier pleaded hence it (the preponderance

>  of
 of ,- 
 that the carrier) must be of authority is and A+ for passenger of the stevedores
accident was liable for in favor of the the transport !ulpicio +ines, sent by A+ on
due to Iengine indemnity to doctrine that a of the latterMs still the latter is board the barge
or mechanical plaintiffs. t is passenger is timber. !everal liable as a of !ulpicio was
troubleJ clear that the entitled to stevedores of common carrier called for by
independent or carrier is not an recover "+ (hired by for his death. the contract of
beyond the insurer of the damages from  A+) boarded carriage.
control of the passengersD a carrier for an the N!olid N 2urthermore,
carrier or of its safety. ;is in#ury resulting and opened its !ulpicio 9new
driver. liability rests from a defect in storeroom. 6Y of the presence
upon negligence, an appliance 1he stevedores and role of the
his failure to purchased from were warned stevedores in
exercise the a manufacturer, of the gas and its barge and
 Mu!/os! whenever it heat generated thus consented
(e)ree o0 appears that by the copra to their
(ili)ence that the defect stored in the presence. 6Y
the law reCuires, would have holds of the ;ence,
and by Art. -4>, been ship. ithout petitioner was
in case of a discovered by heeding the responsible for
passengerMs the carrier if it warning, a their safety
death or in#ury had exercised stevedore while on board
the carrier bears the degree of entered the the barge.
the burden of care which storeroom and
satisfying the under the fell
court that he has circumstances unconscious.
duly discharged was incumbent
the duty of upon it, with
prudence regard to 4.Dura!ion o0 res"onsi#ili!$
reCuired. inspection and
application of Rele'an! "ro'isions:
the necessary
tests. 2or the ivil ode, Article -0>. 1he e<!raor(inar$ res"onsi#ili!$ o0 !e co//on
purposes of this carrier las!s 0ro/ !e !i/e !e )oo(s are uncon(i!ionall$ "lace( in !e
doctrine, the "ossession o08 an( recei'e( #$ !e carrier 0or !rans"or!a!ion un!il !e sa/e
manufacturer is are (eli'ere(8 ac!uall$ or cons!ruc!i'el$8 #$ !e carrier !o !e consi)nee8 or
considered as !o !e "erson 2o as a ri)! !o recei'e !e/ , without pre#udice to the
being in law the provisions of article -07.
agent or
servant of the Rele'an! A)#a$ani No!es:
carrier, as far Wen rela!ionsi" o0 carrier an( "assen)er !er/ina!es.== 1he relation of 
as regards the and passenger does not cease at the moment that the passenger alights from the
wor9 of Ms vehicle at a place selected by the  at the point of destination, but continues
constructing the until the passenger had reasonable time or a reasonable opportunity to leave the Ms
appliance. I premises. hat is a reasonable time or a reasonable delay within this rule is to be
!ulpicio  A contract of 1he court agreed  A+ had a determined from all the circumstances.
v. ourt carriage was with the A that contract of
of entered into although carriage with Cases:
 Appeals between Pamalaran was !ulpicio +ines. A!& 2A1! ;&+B B1R/& +A!!
!ulpicio +ines never a 1he presence of  11+& /1&!
  of ,- 
angco <ose angco came in Proof of fault 1he con!rac!ual before the plaintiffMs
v. %RR  by train daily to the imputable to o#li)a!ion o0 position had become
%anila Railroad %anila *anila Railroa( !o secure, and even
ompany. ne RailroadDs !rans"or! "lain!i00 before his raised right
evening, he got off servants B&! also carrie( 2i! i! foot had reached the
the train expecting to /1 &L'!& !e (u!$ !o platform, the
land at the concrete %anila Railroad !rans"or! i/ motorman applied
platform where from being sa0el$ an( !o power, with the result
people safely alight liable to the "ro'i(e sa0e that the car gave a
but his foot$feet plaintiff. /eans 0or !e slight lurch forward.
came into contact "lain!i00 !o en!er 1his caused the
with a sac9 of an( lea'e i!s plaintiffMs foot to slip,
watermelons, causing !rains8 #ase( on and his hand was
him to fall onto the OCC ,4.  #er9ed loose from the
platform, and his handpost.
body to roll from the +a Plaintiffs, husband arrier is liable. t has been
platform and become %allorc and wife, together  Although it is recogni8ed as a rule
drawn under the a v. with their minor true that that the relation of 
moving car (right arm ourt daughters boarded respondent carrier and passenger
badly lacerated). of  the Pambusco "us. %ariano does not cease at the
Bel  After the street car %eralco should 1he relation between  Appeal  After arriving, "eltranDs family moment the
Prado had stopped at its be liable. a carrier of   s %ariano led his family had alighted passenger alights
v. appointed place for  Although the passengers for hire to a shaded spot on from the bus at from the carrierMs
%eralc ta9ing on and letting motorman of  and its patrons is of a the left pedestrian a place vehicle at a place
o off passengers, it this car was contractual nature. side of the road. ;e designated for selected by the
resumed its course at not bound to 2ailure on the part of  returned to the bus to disembar9ing carrier at the point of 
a moderate speed. stop to let the the carrier to use due get his other bayong , or unloading of  destination, but
1he car had plaintiff on, it care in carrying its which he had left passengers, the continues until the
proceeded only a was his duty to passengers safely is a behind. RaCuel father had to passenger has had a
short distance, do no act that breach of duty (culpa  followed him without return to the reasonable time or a
however, when would have the contructual ) under him noticing. hile vehicle (which reasonable
gnacio del Prado ran effect of   articles @, @0 said %ariano "eltran was still at a opportunity to leave
across the street to increasing the and @? of the ivil was on the running stop) to get the carrierMs
catch the car. plaintiffMs peril ode. 2urthermore, board of the bus one of his bags premises. And, what
Plaintiff, upon while he was !e (u!$ !a! !e waiting for the 1he relation of  is a reasonable time
approaching the car, attempting to carrier o0   conductor to hand carrier and or a reasonable delay
raised his hand as an board the car. "assen)ers o2es him his bayong   which passenger does within this rule is to
indication to the 1he premature !o i!s "a!rons he left under one of  not necessarily be determined from
motorman of his acceleration of  e<!en(s !o "ersons its seats near the cease where all the circumstances.
desire to board the the car was, in #oar(in) !e cars door, the bus, whose the latter, after
car. 1he motorman our opinion, a as 2ell as !o !ose motor was not shut alighting from
eased up a little, breach of this ali)!in) off while unloading, the car, aids
without stopping. 1he duty. !ere0ro/. suddenly started the carrierMs
plaintiff sei8ed the moving forward, servant or
front perpendicular notwithstanding the employee in
handpost, at the fact that the removing his
same time placing his conductor has not baggage from
left foot upon the given the driver the the car.
platform. ;owever, customary signal to

?  of ,- 
 start because he was for his departure.
getting %arianoDs PA+ v. %r. Kapatos was arrier is liable. Part of the failure to
bayong . A onboard PR?-- flight PA+Ms diversion comply with the
"atacla "us no. 0@ of the arrier is liable.  A satisfactory which route was of its flight due obligation of common
n v. %edina 1here was definition of   ebu68amis6 to inclement carrier to deliver its
%edina 1ransportation left negligence on proximate cause is otabato. %r. weather was a passengers safely to
the town of Amadeo, the part of the found in olume 07, Kapatos was fortuitous their destination lay
avite. Among the defendant, pages >346>3> of  supposed to event. in the (e0en(an!s
passengers was <uan through his  American disembar9 in 8ami8 /onetheless, 0ailure !o "ro'i(e
"ataclan. hile the agent, the  #urisprudence, cited but the plane could suc co/0or! an(
bus was running one driver !aylon. by plaintiffs6 not land due to bad occurrence con'enience !o i!s
of the front tires 1here is appellants in their weather. 1hey were (i( no! s!ran(e(
burst and the vehicle evidence to brief: IXthat cause, instructed by the !er/ina!e "assen)ers  using
began to 8ig68ag until show that at which, in natural and airport to go straight PALs extraordinary
it fell into a canal on the time of the continuous seCuence, ahead to otabato.;e con!rac! 2i! diligence, the cause
the right side of the blow out, the unbro9en by any claims he was left i!s o0 non=0ul0ill/en!
road and turned bus was efficient intervening alone in the airport "assen)ers. is no! solel$ an(
turtle. !ome of the speeding. cause, produces the and was denied "eing in the e<clusi'el$ (ue !o
passengers managed in#ury, and without transportation when business of air 0or!ui!ous e'en!,
to leave the bus. alls which the result he as9ed some PA+ carriage and but due to something
or shouts for help would not have staff for a ride. ;e the sole one to which defendant
were made to the occurred.J  lost his personal operate in the airline could have
houses in the belongings when it country, PA+ is prevented, defendant
neighborhood. After was not offloaded deemed becomes liable to
half an hour came from the plane. eCuipped to plaintiff.
about ten men, one deal with
of them carrying a situations as in
lighted torch made of  the case at bar
bamboo fueled with
petroleum. A fierce .Presu/"!ion o0 Ne)li)ence
fire started, burning
the bus. Rele'an! "ro'isions:
 Aboiti8  Anacleto iana arrier is liable. All persons who ivil ode, Article -4>. n case of (ea! o0 or in7uries !o "assen)ers , co//on
v. boarded Aboiti8Ds %$ remain on the carriers are "resu/e( !o a'e #een a! 0aul! or !o a'e ac!e( ne)li)en!l$8
ourt  Antonia for %anila. premises a unless !e$ "ro'e !a! !e$ o#ser'e( e<!raor(inar$ (ili)ence  as prescribed in
of   After they reasona#le !i/e articles -00 and -44.
 Appeal disembar9ed, %r. after leaving the
s  iana went bac9 to conveyance are to be Rele'an! A)#a$ani No!es:
the vessel because he deemed passengers, Presu/"!ion o0 ne)li)ence.== s are presumed to have been at fault or to have
remembered that he and 2a! is a acted negligently in case of death or in#uries to passengers. 1his disputable
still had cargoes reasona#le !i/e or presumption may only be overcome by superior evidence that he had observed
inside. ;e was a reasona#le (ela$ extraordinary diligence prescribed in -00, -44, -4>
pointing to his 2i!in !is rule is here death or in#ury results to the passenger because of the negligence of the Ms
cargoes when he was !o #e (e!er/ine( employees, the  is liable, notwithstanding the fact that he had exercised all the
hit by the crane. 0ro/ all !e diligence of a good father of a family, in the selection and supervision of his
circu/s!ances, and employees.
includes a reasonable onseCuently, in an action for damages, the issue is not / the party see9ing
time to see after his damages has adduced sufficient evidence to show the negligence of the  but /
baggage and prepare the carrier has presented the reCuired Cuantum of proof to overcome the

  of ,- 
presumption that it has been at fault or that it acted negligently in the performance A!& 2A1! ;&+B B1R/& +A!!
of its duty. 11+& /1&!
n the exercise of extraordinary diligence, the  must give due regard for all "achelor "achelor &xpressD  arrier is liable.  A 2orce %a#eure
circumstances in connection with the transport of passengers. &xpress v. bus driven by 'nder Article presents the
ourt of resencio Rivera -4> of the ivil following essential
Ho2 "resu/"!ion o0 ne)li)ence o'erco/e.== 1o overcome such presumption, it  Appeals was the site of a ode, petitioner characteristics:
must be shown that the  had observed the reCuired extraordinary diligence or that stampede which "achelor () 1he cause of the
the accident was caused by fortuituos event. n order to constitute caso fortuito that 9illed rnominio &xpress, nc. is unforeseen and
would exempt a person from responsibility, it is necessary that : "eter and "resu/e( !o unexpected
. 1he event must be independent of human willE /arcisa Rautraut. a'e ac!e( occurrence, or of
5. 1he occurrence must render it impossible for the obligor to fulfill his obligation in a 1he commotion ne)li)en!l$ the failure of the
normal mannerE started when a unless it can debtor to comply
0. 1he obligor must be free of a concurrent or contributory fault or negligence. passenger at one prove that it had with his obligation,
of the rear seats observed must be
Carrier no! "reclu(e( 0ro/ "ro'in) ne)li)ence o0 o!er carrier in'ol'e( in stabbed a P extraordinary in(e"en(en! o0
collision.== hile the plaintiff6passenger does not need to prove the negligence of  soldier. 1he diligence in !e u/an 2ill .
the , he may not preclude the  from proving the legal defense of negligence of  passengers accordance with (5) t must be
the other vehicle involved in the collision (  may file a third6party complaint against panic9ed and  Articles -00 i/"ossi#le !o
the other vehicle for reimbursement) tried to get out and -44. n 0oresee !e e'en!
of the bus. 1hey order that a which constitutes
Las! clear cance rule no! a""lica#le !o con!rac!s o0 carria)e.== 1he say that "eter common carrier the force ma#eure,
principle of last clear chance applies only in a suit between the owners and drivers of  and Rautraut may be absolved or i0 i! can #e
two colliding vehiclesE it does not apply where a passenger demands responsibility  #umped off the from liability in 0oreseen8 i! /us!
from the  to enforce its contractual obligationE it would be iniCuitous to exempt the bus through the case of force #e i/"ossi#le !o
driver and his &R on the ground that the other driver was also negligent window without ma#eure , it is a'oi(.
the formerDs no! enou) (0) 1he occurrence
Cour! nee( no! /a9e e<"ress 0in(in) o0 carriers 0aul! or ne)li)ence.== 1he consent, !a! !e must be such as to
court need not ma9e an express finding of fault or negligence on the part of the  in therefore the acci(en! 2as render it
order to hold it responsible to pay the damages sought by the passenger. "y the company and the cause( #$ i/"ossi#le 0or !e
contract of carriage, the  assumes the express obligation to observe extraordinary driver could not 0orce /a7eure . (e#!or !o 0ul0ill
diligence in transporting the passenger 1his is an exception to general rule that be at fault. 1he common is o#li)a!ion in a
negligence must be proved. carrier /us! nor/al /anner .
s!ill "ro'e !a! (?) 1he obligor
Carriers no! or(inaril$ lia#le 0or in7uries !o "assen)ers (ue !o 0ires or i! 2as no! (debtor) /us! #e
e<"losions cause( #$ ar!icles #rou)! in!o con'e$ance #$ o!er ne)li)en! in 0ree 0ro/ an$
"assen)ers.==  is not ordinarily liable for in#uries to passengers due to fires or causin) !e "ar!ici"a!ion in
explosions caused by articles brought into conveyance by other passengers. 2airness in7uries !e a))ra'a!ion
demands that in measuring the Ms duty towards its passengers, allowance should resul!in) 0ro/ o0 !e in7ur$
be given to the reliance that should be reposed on the sense of responsibility of all suc acci(en!. resulting to the
the passengers in regard to their common safety (that the passenger will not ta9e creditor.
with him anything dangerous to his co6passengers.) 2or the carrier to be liable, he
must be aware, through his &&s of the nature of the article or must have had some  Gobido v. 1ito and +eny hether the 1he common carrier
reason to anticipate danger therefrom (ircumstances must show that there are A 1umboy, with explosion of a may not be
causes for apprehension that the passengerMs baggage is dangerous and that the  their 5 children, newly installed absolved from
fails to act in the fact of such evidence) boarded a Gobido tire of a liability in case of 
+iner bus. 1he passenger force ma#eure alone.
>.;orce *a7eure left front tire of  vehicle is a 1he common carrier
the bus fortuitous event must still prove that
Cases: exploded. that exempts it was not negligent

  of ,- 
  Affirmative the carrier from in causing the death transportation of the passenger from the place of departure to the place of 
defense: caso liability for the or in#ury resulting destination which are stated in the tic9et.
fortuito: 1he bus death of a from an accident.
conductor passenger  Passen)er #oun( no!2i!s!an(in) is 0ailure !o si)n !ic9e! con!ainin)
testified that the / 1he fact s!i"ula!ion li/i!in) lia#ili!$.== &ven if the passenger failed to sign the tic9et, he is
bus was not full that the tire was nevertheless bound by the provisions thereof. !uch provisions are part of the contract
of passengersE new did not of carriage, regardless of the passengerMs lac9 of 9nowledge or assent to the
that the tire imply that it was regulation. t is what is 9nown as a contract of adhesion which is not entirely
which exploded entirely free prohibited by law. 1he one who adheres to the contract is in reality free to re#ect it 
was a brand new from entirelyE if he adheres, he gives his consent . Accordingly, where the  incurred
oodyear tire manufacturing delay, it is liable only for the amount printed in the tic9et the passenger not having
which he defects or that it declared a higher value for his luggage nor paid addtl. charges.
mounted only 4 was properly
days before the mounted on the Dis"ensin) 2i! or li/i!in) lia#ili!$.== eneral rule: 'nder -4-, the
incident. vehicle. /either extraordinary diligence reCuired under -00 and -44 for the carriage of passengers
may the fact cannot be dispensed with or lessened () by stipulation, (5) by the posting of notices,
that the tire (0) by statements on tic9ets, or (?) otherwise
bought and used hat cannot be stipulated in a carriage of passengers :
in the vehicle is () absolutely exempting the  from liability from the passengerMs death or in#uriesE
of a brand name (5) lessening the extraordinary diligence reCuired by law to the diligence of a good
noted for father of a family
Cuality, resulting &xception: &ffect of gratuitous carriage.66 'nder -47, the  and the passenger may
in the conclusion validly stipulate limiting the Ms liability for negligence where the passenger is
that it could not carried gratuitously (but the parties cannot stipulate to entirely eliminate liability of 
explode within )
five daysD use.
E00ec! o0 re(uc!ion o0 0ares.== 'nder -47 (5), the reduction of fare does not
 #ustify any limitation of the Ms liability 66 the law reCuires gratuitous passage.
.Li/i!a!ion o0 lia#ili!$ 'ali(i!$ o0 s!i"ula!ions 1he law is much stricter with respect to carriage of passengers as compared with
carriage of goods: a stipulation limiting the Ms liability in writing, signed by the
Rele'an! "ro'isions: parties, supported by sufficient consideration, not contrary to law will still be void
ivil ode, Article -4- . 1he res"onsi#ili!$ o0 a co//on carrier 0or !e sa0e!$ where the passenger is not carried gratuitously.
o0 "assen)ers as re&uire( in ar!icles , an( , canno! #e (is"ense(
2i! or lessene( #$ s!i"ula!ion8 #$ !e "os!in) o0 no!ices8 #$ s!a!e/en!s on Lia#ili!$ o0 o2ner o0 CC !o acco//o(a!ion "assen)ers or in'i!e( )ues!s.
!ic9e!s8 or o!er2ise.  An owner of an automobile owes a guest the duty to exercise ordinary or reasonable
care to avoid in#uring himE since one riding in an automobile is no less a guest
ivil ode, Article -47. hen a "assen)er is carrie( )ra!ui!ousl$ , a s!i"ula!ion because he as9ed for the privilege of doing so, the same obligation of care is imposed
li/i!in) !e co//on carriers lia#ili!$ 0or ne)li)ence is 'ali(8 #u! no! 0or upon the driver and owner as in the case of one expressly invited to ride
2il0ul ac!s or )ross ne)li)ence .
1he re(uc!ion o0 0are (oes no! 7us!i0$ an$ li/i!a!ion o0 !e co//on carriers
lia#ili!$. ?.Res"onsi#ili!$ 0or ac!s o0 e/"lo$ees

Rele'an! A)#a$ani No!es: Rele'an! "ro'isions:

Tic9e! )i'en !o a "assen)er is a 2ri!!en con!rac!.== 1ic9et given to passenger is
a written contract with the ff. elements: () the consent of the contracting parties
manifested by the fact that the passenger boards the ship and the shipper consents
or accepts him in the ship for transportationE (5) cause or consideration which is the
fare paid by the passenger as stated in the tic9etE (0) ob#ect , which is the
ivil ode, Article -43. Co//on carriers are lia#le 0or !e (ea! o0 or in7uries
!o "assen)ers !rou) !e ne)li)ence or 2il0ul ac!s o0 !e 0or/ers
e/"lo$ees8 al!ou) suc e/"lo$ees /a$ a'e ac!e( #e$on( !e sco"e o0 
!eir au!ori!$ or in 'iola!ion o0 !e or(ers o0 !e co//on carriers.

  of ,- 
1his liability of the common carriers (oes no! cease u"on "roo0 !a! !e$
e<ercise( all !e (ili)ence o0 a )oo( 0a!er o0 a 0a/il$ in !e selec!ion an(
su"er'ision of their employees.
ivil ode, Article ->@. 1he co//on carriers res"onsi#ili!$ "rescri#e( in !e
"rece(in) ar!icle canno! #e eli/ina!e( or li/i!e( #$ s!i"ula!ion8 #$ !e
"os!in) o0 no!ices8 #$ s!a!e/en!s on !e !ic9e!s or o!er2ise.
Wen rela!ionsi" o0 carrier an( "assen)er !er/ina!es.== 1he relation of 
and passenger does not cease at the moment that the passenger alights from the
Ms vehicle at a place selected by the  at the point of destination, but continues
until the passenger had reasonable time or a reasonable opportunity to leave the Ms
premises. hat is a reasonable time or a reasonable delay within this rule is to be
determined from all the circumstances

Relevant Agbayani /otes: Eli/ina!ion or li/i!a!ion o0 carriers lia#ili!$.== 'nder ->@, the Ms liability for
Lia#ili!$ 0or ne)li)ence or 2ill0ul ac!s o0 e/"lo$ees.== 'nder -43,  are held the negligence or willful acts of his &&s which cause death of or in#ury to passengers
liable for the death or in#uries to passengers caused by the negligence or the willful cannot be eliminated or limited by () stipulation, (5) by the posting of notice, (0) by
acts of their &&s, although such &&s may have acted beyond the scope of their statements on the tic9ets, or (?) otherwise
authority or in violation of the orders of the . 1he  cannot escape liability by
interposing the defense that its &&s have acted without any authority or against the Cases:
orders of the . A!& 2A1! ;&+B B1R/& +A!!
1he passenger is entitled to protection from personal violence by the  or its agents 11+& /1&!
or &&s since the contract of transportation obligates the  to transport a passenger Be orneliaDs husband, %R is not "ased on the case of 
safely to his destination and a  is responsible for the misconduct of its &&s illaco 1omas illaco, was a liable. / 1;! +asam vs. !mith ,
v. %RR  passenger of the A!&, the act while the rule is that
ardenas vs 2ernando:  () &xtraordinary diligence reCuired of : calculated to morning train of of guard the carrier would be
protect the passengers as demanded by the preciousness of human life and by the %anila Railroad Bevesa of liable for damages
consideration that every person must in every way be safeguarded against all in#uryE ompany. Bevesa shooting for not complying
(5) +iability for in#ury of passenger is based on a breach of contract of carriage for had a long standing passenger with the contract of
failure to bring the passenger safely to his destination personal grudge illaco because carriage, the carrier
against illaco so of a personal may be exempt from
Reason 0or /a9in) !e CC lia#le 0or !e /iscon(uc! o0 i!s EEs in !eir o2n when he saw the grudge liability if it proves
in!eres!.== 1he servant is clothed with delegated authority and charged with the latter inside the train nurtured that the failure to
duty by the , to execute his underta9ing to carry the passenger safelyE when the coach, he shot against the fulfill his obligation
&& mistreats the passenger, he violates the contractual obligation of the  for which illaco with the latter since the was due to
he represents the . carbine furnished to <apanese fortuitous events or
him by %R. illaco occupation was acts which cannot
Lia#ili!$ o0 CC 0or (e0ec!s o0 i!s e&ui"/en!.==  A passenger is entitled to recover died. %R argued unforeseeable be foreseen, or if
damages from a  for an in#ury resulting from a defect in an appliance purchased that: t is not by the %R. foreseen, are
from a manufacturer, whenever it appears that the defect would have been responsible 1he latter had inevitable.
discovered by the  if it had exercised the degree of care which under the subsidiary ex delicto no means to
circumstances was incumbent upon it, with regard to inspection and application of  because the crime ascertain or
the necessary testsE for the purposes of this doctrine, the manufacturer is considered was not committed anticipate that
as being in law the agent or servant of the , as far as regards the wor9 of  while the slayer was the two would
constructing the appliance. in the actual meet, nor could
performance of his it reasonably
Co//on carrier is e<e/"! 0ro/ ac!s o0 EE no! (one in line o0 (u!$.== 1he  ordinary duties and foresee every
is exempt from liability where the && was never in a position in which it became his service. personal rancor
duty to his &R to represent him in discharging any duty of the  towards the that might exist
passengerE the && is deemed as a stranger or co6passenger since his act was not between each
done in the line of duty. one of its many
employees and
De0ense o0 (ili)ence in selec!ion8 e!c.8 o0 e/"lo$ees.==  cannot escape any one of the
liability by interposing defense that he exercised due diligence in the selection and thousands of
supervision of his &&sE his liability is based on culpa contractual. eventual
?-  of ,- 
 passengers the security guard utmost diligence of 
riding in its assigned to the area very cautious
trains approached /avidad. persons with due
 A misunderstanding regard for all
%aranan Rogelio orachea arrier is liable. 1he ! made or an altercation circumstances.  is
v. Pere8 (%arananDs son) was t is enough several distinctions between the two liable for death of or
a passenger in a that the assault between illaco  and apparently ensued in#ury to passengers
taxicab owned and happens within this case: that led to a fist (a) through the
operated by Pascual the course of  .n illaco , the fight. /avidad fell on negligence or wilful
Pere8 when he was the employeeMs employee was not the +R1 trac9s. At acts of its employees
stabbed and 9illed by duty. 1he yet on duty. / 1;! the exact moment or b) on account of 
the cab driver, carrierMs liability A!&: the 9illing that /avidad fell, an wilful acts or
!imeon alen8uela. is absolute in was perpetrated by +R1 train, operated negligence of other
Pere8 claimed that the sense that the driver of the by Roman, was passengers or of 
the death was a caso  it practically very cab coming in. strangers if the
fortuito for which the secures the transporting the common carrierDs
carrier was not liable. passengers passenger, in whose employees through
from assaults hands the carrier the exercise of due
committed by had entrusted the diligence could have
its own duty of executing prevented or
employees the contract of   stopped the act or
carriage omission.
5.illaco was
decided under the .Res"onsi#ili!$ 0or ac!s o0 s!ran)ers an( co="assen)ers
provisions of the Rele'an! "ro'isions:
ivil ode of 773 ivil ode, Article ->0.  A co//on carrier is res"onsi#le 0or in7uries su00ere(
which, unli9e the #$ a "assen)er on accoun! o0 !e 2il0ul ac!s or ne)li)ence o0 o!er
present ivil ode, "assen)ers or o0 s!ran)ers8 i0 !e co//on carriers e/"lo$ees !rou) !e
did not impose upon e<ercise o0 !e (ili)ence o0 a )oo( 0a!er o0 a 0a/il$ coul( a'e "re'en!e(
common carriers or s!o""e( !e ac! or o/ission .
absolute liability.
hile the provision Rele'an! A)#a$ani No!es :
on fortuitous events 1he  is responsible for such willful acts or negligence of other passengers or of 
has been strangers, provided that the Ms &&s could have prevented or stopped the act or
substantially omission through the exercise of ordinary diligence. f the in#ury could not have been
reproduced in Art. avoided by the exercise of ordinary diligence on the part of the &&s of the , the 
-? of the /ew is not liable
ivil ode, Art. -43 /otice that the law spea9s of in#uries suffered by the passenger but not his death.
expressly ma9es the ;owever, there appears to be no reason why the common carrier should not be held
common carrier liable under such circumstances. 1he word Nin#uriesN should be interpreted to include
liable for intentional Ndeath.N
assaults committed
by its employees Cases:
upon its passengers A!& 2A1! ;&+B B1R/& +A!!
11+& /1&!
+R1A v. /avidad, then drun9, nly +R1A is 1he law reCuires Pilapil v. <ose Pilapil is a $/ the bus hile a common
/avidad was standing on the liable for the common carriers to A passenger who company carrier is engaged in
platform near the death of   carry passengers boarded should be the business of
+R1 trac9s. &scartin, /avidad. safely using the defedendant AlatcoDs liable for the transporting
?, of ,- 
 bus. An unidentified stone passengers and ivil ode, Article ->. 1he "assen)er /us! o#ser'e !e (ili)ence o0 a )oo(
man along said throwing goods, it does not 0a!er o0 a 0a/il$ !o a'oi( in7ur$  to himself.
highway, hurled a incident* / give its consent to
stone at the left side become an insurer of ivil ode, Article ->5. 1he con!ri#u!or$ ne)li)ence o0 !e "assen)er (oes
of the bus, which hit any and all ris9s to no! #ar reco'er$ o0 (a/a)es  for his death or in#uries, i0 !e "ro<i/a!e cause
petitioner in the eye. passengers and !ereo0 is !e ne)li)ence o0 !e co//on carrier , but the a/oun! o0 (a/a)es
goods even despite sall #e e&ui!a#l$ re(uce( .
the reCuirement that
it observe utmost Cases:
diligence. A common A!& 2A1! ;&+B B1R/& +A!!
carrier merely 11+& /1&!
underta9es to angco v. <ose angco came angcoDs step ontributory
perform certain duties %RR  in by train daily to was not negligence serves to
to the public as the the %anila Railroad uncertain (it negate or distribute
law imposes, and ompany. ne was measured) the liability of the
holds itself liable for evening, he got off  as he was used defendant. t can be
any breach thereof  the train expecting to riding the determined by ta9ing
to land at the trains and thus, into consideration the
"achelor "achelor &xpressD  arrier is 1he common carrier concrete platform his act of age, sex, and
&xpress bus driven by liable. . t is responsible for where people stepping off the physical condition of
nc. v. resencio Rivera was found that in#uries suffered by a safely alight but his train was not the passenger or
A the site of a the there is passenger on account foot$feet came into attended by person in Cuestion.
stampede which no reason to of the wilful acts or contact with a sac9  imprudenceE 1he applicable test in
9illed rnominio believe that negligence of other of watermelons, thus, he is not determining his guilt
"eter and /arcisa the deceased passengers or of  causing him to fall guilty of or innocence with
Rautraut. 1he passengers strangers, if the onto the platform, contributory respect to
commotion started  #umped from common carrierMs and his body to roll negligence contributory
when a passenger at the window employees through from the platform negligence is the test
one of the rear seats when it was the exercise of the and become drawn of ordinary or
stabbed a P soldier. entirely diligence of a good under the moving reasonable care.
1he passengers possible for father of a family car (right arm
panic9ed and tried to them to have could have prevented badly lacerated).
get out of the bus. alighted or stopped the act or saac v. saac paid and saac is guilty t is the prevailing
1hey say that "eter through the omission.  A.+. boarded "us /o. of contributory rule that it is
and Rautraut #umped door. t also  Ammen 0 of A.+. Ammen. negligence. negligence per se for
off the bus through found that 1he bus collided saac seated a passenger on a
the window without the bus driver with a motor himself on the railroad voluntarily or
the formerDs consent, did not vehicle. saacDs left left side thereof  inadvertently to
therefore the immediately arm was resting his left protrude his arm,
company and the stop the bus completely arm on the hand, elbow, or any
driver could not be when the severed. window sill but other part of his body
at fault. commotion with his left through the window
started. elbow outside of a moving car
the window, beyond the outer
this being his edge of the window
.Du!$ o0 "assen)er e00ec! o0 con!ri#u!or$ ne)li)ence position in the or outer surface of 
bus when the the car, so as to
Rele'an! "ro'isions: collision too9  come in contact with
place. ;ad he ob#ects or obstacles
?4  of ,- 
 not placed his near the trac9, and actual, %oral damages ode.
left arm on the that no recovery can compensatory, were not
window sill with be had for an in#ury moral and granted.
a portion which but for such exemplary
thereof  negligence would not damages was
protruding have been filed.
outside, sustained.1his Pan Am Pangan sued Pan !pecial n order to hold the
perhaps the contributory v. A  Am for the delay damages on carrier liable for special
in#ury would negligence cannot in the delivery of  account of the damages (damages other
have been relieve the driver of  his luggage, cancellation of  than those naturally and
avoided as is its liability but will causing the PanganDs directly arising from the
the case with only entitle it to a cancellation of his agreements breach), such special
the other reduction of the prior agreements. were not damages must have been
passenger. amount of damage granted. brought within the
caused (Article ->5, contemplation of the
new ivil ode). parties as a probable
result of the breach at
D.Da/a)es Reco'era#le 0ro/ Co//on Carriers the time of contracting.
 illa6  A bus hit a 1he 2ormula for life
,.In )eneral Rey v. bullcart, resulting determination expectancy:
4.Ac!ual or co/"ensa!or$ A in the death of  of the amount 5$0 x (7@6present age)
one of the busD  of damages to
Rele'an! "ro'isions: passengers. An be awarded
ivil ode, Article 533. E<ce"! as "ro'i(e( #$ la2 or #$ s!i"ula!ion , one is action for varies in every
en!i!le( !o an a(e&ua!e co/"ensa!ion onl$ 0or suc "ecuniar$ loss su00ere( damages was case. ;ere, the
#$ i/ as e as (ul$ "ro'e( . !uch compensation is referred to as ac!ual or filed. life expectancy
co/"ensa!or$ (a/a)es. of the victim
was ta9en into
ivil ode, Article 55@ . In con!rac!s an( &uasi=con!rac!s8 !e (a/a)es 0or account.
2ic !e o#li)or 2o ac!e( in )oo( 0ai! is lia#le sall #e !ose !a! are PA+ v. Padilla died as a Bamages were 1he award of damages
!e na!ural an( "ro#a#le conse&uences o0 !e #reac o0 !e o#li)a!ion8 an( A result of a plane computed for death is to computed
2ic !e "ar!ies a'e 0oreseen or coul( a'e reasona#l$ 0oreseen a! !e crash. ;is mom based on the based on the life
!i/e !e o#li)a!ion 2as cons!i!u!e(. sued for actual, life expectancy expect ancy of the
n case of fraud, #a( 0ai!8 /alice or 2an!on a!!i!u(e , the o#li)or sall #e compensatory, of the deceased, and not of the
res"onsi#le 0or all (a/a)es 2ic /a$ #e reasona#l$ a!!ri#u!e( !o !e and exemplary deceased, not beneficiaries.
non="er0or/ance o0 !e o#li)a!ion . (@-a) damages. his mom.
 ictory  A bus fell into a 1he award for R: Bocumentary
Cases: +iner v. ravine, causing compensatory evidence should be
A!& 2A1! ;&+B B1R/& +A!! amma the death of one damages was adduced to substantiate
11+& /1&! d of its passengers. deleted for a claim for compensatory
ariaga  A bus collided with ompensatory  All circumstances are to  Actual damages, lac9 of basis. damages. &xc: ()
v. +1" a train, causing damages were be ta9en into account in death indemnity, nly the deceased is self6
o. the death of the increased computing for and compensatory testimony of  employed earning less
bus driver and considering the compensatory damages, damages, among the husband of  than the minimum wageE
in#uries to several effects of the such as earning capacity others, was the deceased (5) deceased is a daily
passengers accident on the and life expectancy. sought for by the was offered to wage wor9er earning less
including a ? th student (esp. %oral damages may only heirs of the victim. support its than the minimum wage.
year med student. permanent be awarded in instances claim for the
 A case more disabilities). enumerated in the ivil said damages.
?:  of ,- 
 A!& 2A1! ;&+B B1R/& +A!!
11+& /1&!
. *oral 2ores v.  A #eepney hit the %oral damages R: f no death
%iranda bridge wall, should not be arises, no moral
Rele'an! Pro'isions: causing in#uries awarded. R: f no damages may be
to one of its death arises, no recovered.
+ B&, Art. 55>. No "roo0 o0 "ecuniar$ loss is necessar$ in or(er !a! passengers. moral damages &xc: bad faith or
/oral8 no/inal8 !e/"era!e8 li&ui(a!e( or e<e/"lar$ (a/a)es8 /a$ #e may be recovered. malice on the part
a(7u(ica!e(. 1he assess/en! o0 suc (a/a)es8 e<ce"! li&ui(a!e( ones8 is &xc: bad faith or of the carrier.
le0! !o !e (iscre!ion o0 !e cour! , according to the circumstances of each case. malice on the part
of the carrier. n
ivil ode,Art. 55-. *oral (a/a)es inclu(e "$sical su00erin)8 /en!al this case, bad
an)uis8 0ri)!8 serious an<ie!$8 #es/irce( re"u!a!ion8 2oun(e( 0eelin)s8 faith$malice on the
/oral soc98 social u/ilia!ion8 an( si/ilar in7ur$ . 1hough inca"a#le o0  part of the #eepney
"ecuniar$ co/"u!a!ion8 /oral (a/a)es /a$ #e reco'ere( i0 !e$ are !e driver was not
"ro<i/a!e resul! o0 !e (e0en(an!s 2ron)0ul ac!  or omission. proven.
 Air 2rance arrascoso sued %oral damages  A breach of
ivil ode,Article 553. *oral (a/a)es /a$ #e reco'ere( in !e 0ollo2in) an( v.  Air 2rance for were awarded. contract attended
analo)ous cases : arrascoso moral damages, 1here was a breach by bad faith
arising from the of contract, amounts to a
5,6 A cri/inal o00ense resul!in) in "$sical in7uries act of Air 2rance attended by bad Cuasi6delict,
546 uasi=(elic!s causin) "$sical in7uries of depriving him faith on the part of entitling the
56 Se(uc!ion8 a#(uc!ion8 ra"e8 or o!er lasci'ious ac!s of his first6class  Air 2rance. aggrieved party to
5>6 A(ul!er$ or concu#ina)e seat in favor of a moral damages.
56 Ille)al or ar#i!rar$ (e!en!ion or arres! white man.
5?6 Ille)al searc +ope8 v. Plaintiffs sued %oral damages "ad faith means a
56 Li#el8 slan(er or an$ o!er 0or/ o0 (e0a/a!ion Pan Am Pan Am for moral were properly breach of a 9nown
56 *alicious "rosecu!ion damages, due to awarded. 1here duty through
56 Ac!s /en!ione( in Ar!icle - the latterDs was a breach of some motive of
5,-6 Ac!s an( ac!ions re0erre( !o in Ar!icles 4,8 4?8 48 48 48 -8 48 >8 unilateral contract, attended interest or ill will.
an( . cancellation of a by bad faith on the
1he parents of the female seduced, abducted, raped, or abused, referred to in /o. 0 confirmed part of Pan Am to
of this article, may also recover moral damages. reservation for further its own
1he spouse, descendants, ascendants, and brothers and sisters may bring the action first6class seats interest.
mentioned in /o. 3 of this article, in the order named. made by the
plaintiffs.
ivil ode,Art. 555@. Will0ul in7ur$ !o "ro"er!$ /a$ #e a le)al )roun( 0or rtigas v. rtigas sued %oral damages are nattention and
a2ar(in) /oral (a/a)es  if the court should find that, under the circumstances, +ufthansa +ufthansa for proper. "ad faith lac9 of care on the
such damages are #ustly due. 1he sa/e rule a""lies !o #reaces o0 con!rac! moral damages, attended the part of the carrier
2ere !e (e0en(an! ac!e( 0rau(ulen!l$ or in #a( 0ai!. arising from his breach of contract resulting in the
being deprived of  by +ufthansa. failure of the
ivil ode,Art. 55@>.  1he a/oun! o0 (a/a)es 0or (ea! cause( #$ a cri/e or a first6class seat passenger to be
&uasi=(elic! sall #e a! leas! !ree !ousan( "esos8 e'en !ou) !ere /a$ in favor of a accommodated in
a'e #een /i!i)a!in) circu/s!ances . n addition: "elgian. the class
(0) 1he s"ouse8 le)i!i/a!e an( ille)i!i/a!e (escen(an!s an( ascen(an!s o0  contracted for
!e (ecease( /a$ (e/an( /oral (a/a)es 0or /en!al an)uis #$ reason o0  amounts to bad
!e (ea! o0 !e (ecease(. faith, ma9ing an
award for moral
Cases: damages proper.
?>  of ,- 
PA+ v. %iano sued PA+ %oral damages %oral damages ivil ode,Art. 5505. n con!rac!s an( &uasi=con!rac!s, the cour! /a$ a2ar(
%iano for the delay in should not be are only proper in e<e/"lar$ (a/a)es i0 !e (e0en(an! ac!e( in a 2an!on8 0rau(ulen!8
the delivery of awarded. PA+ was case of a breach rec9less8 o""ressi'e8 or /ale'olen! /anner .
his suitcase. not in bad faith in of contract when
failing to deliver the there is bad faith ivil ode,Art. 5500. E<e/"lar$ (a/a)es canno! #e reco'ere( as a /a!!er o0 
suitcase on time. or fraud. ri)!E the court will decide whether or not they should be ad#udicated.
'nited 2ontanilla sued 2ontanilla is not  An air carrier may
 Airlines v. 'nited Airlines entitled to moral overboo9 provided A!& 2A1! ;&+B B1R/& +A!!
A for damages for damages. hec9ing the same does not 11+& /1&!
denying them in is reCuired, as exceed @H of %ecenas 1wo vessels &xemplary &xemplary
boarding. indicated in the the seating v. A collided damages should damages are
boarding pass, in capacity of the resulting in the be awarded. considered an
order to be allowed aircraft. death of Befendants instrument to
boarding. 1his hundreds of its were negligent, serve the ends of
2ontanilla failed to passengers. A executing law and public
do. 1here was no case for maneuvers policy by
bad faith on the damages was inadeCuately reshaping socially
part of 'nited filed. and belatedly. deleterious
 Airlines. behaviors,
athay  asCue8 sued %oral damages are f no death arises, specifically to
Pacific v. athay Pacific for proper. 1he bad faith or fraud compel common
 asCue8 moral damages, privilege may be need not be carriers to control
for forcing them waived. "y insisting proved in order their employees,
to ta9e the on the upgrade, that moral to tame their
privilege granted athay breached its damages may be rec9less instincts,
them for being contract. properly awarded. and to force them
old ard to ta9e adeCuate
members of the care of human
%arco Polo lub beings and their
(upgrade from property.
business class to
first class). .No/inal8 Te/"era!e8 an( Li&ui(a!e(
 Air 2rance illego sued Air %oral damages &ntitlement to
v. illego 2rance for the were properly moral damages Rele'an! Pro'isions:
latterDs failure to awarded. Air arises from the
deliver his 2rance acted in bad attendance of bad ivil ode,Art. 555. No/inal (a/a)es are a(7u(ica!e( in or(er !a! a ri)! o0 
luggage and act faith in repeatedly faith in: () !e "lain!i008 2ic as #een 'iola!e( or in'a(e( #$ !e (e0en(an!8 /a$ #e
of ignoring his ignoring illegoDs securing the 'in(ica!e( or recogni8ed, and no! 0or !e "ur"ose o0 in(e/ni0$in) !e
follow6up calls. follow6up calls. contractE (5) "lain!i00 0or an$ loss  suffered by him.
execution thereof.
ivil ode,Art. 555?. Te/"era!e or /o(era!e (a/a)es8 2ic are /ore !an
>.E<e/"lar$ no/inal #u! less !an co/"ensa!or$ (a/a)es8 /a$ #e reco'ere( 2en !e
cour! 0in(s !a! so/e "ecuniar$ loss as #een su00ere( #u! i!s a/oun! can
Rele'an! Pro'isions: no!8 0ro/ !e na!ure o0 !e case8 #e "ro'i(e( 2i! cer!ain!$.

+ B&, Art. 5553 . E<e/"lar$ or correc!i'e (a/a)es are i/"ose(8 #$ ivil ode,Art. 555>. Li&ui(a!e( (a/a)es are !ose a)ree( u"on #$ !e
2a$ o0 e<a/"le or correc!ion 0or !e "u#lic )oo( , in addition to the moral, "ar!ies !o a con!rac!8 !o #e "ai( in case o0 #reac  thereof.
temperate, liCuidated or compensatory damages.
A!& 2A1! ;&+B B1R/& +A!!

?  of ,- 
 11+& /1&! arrangement
 Alitalia v. Pablo sued Alitalia /ominal /ominal damages are to s to
A for damages, damages ad#udicated in order transport the
arising from the may be that a right of the passengers
6month delay in properly plaintiff, which has been in the next
the delivery of her awarded. violated or invaded by available
luggage, which the defendant, may be connecting
caused him to be vindicated and flight to
unable to attend to recogni8ed, and not for %anila.
his appointments, the purpose of !avellano !avellano sued / !avellano is /ominal damages are
conference, etc. indemnifying the v. for damages, entitled to recoverable if no actual,
plaintiff for any loss /orthwest arising from the nominal substantial or specific
suffered. unilateral changing damages. ;e damages were shown to
!aludo
!aludo v. !aludo caused the !aludo is /omina
/ominall damage
damagess are of stopping places and others have resulted from the
A ship
shipme
ment nt of the the enti
entitl
tled
ed to recoverabl
recoverable e when: () and connecting suffered breach. 1he amount is
body of her mother nominal some
some in#ury
in#ury has been cities. inconvenienc sub#ect to the sound
from
from hic hicag
agoo to damages. done, but (5) the es. 1he discretion of the court.
the
the Phil
Philip
ippi
pine
nes.
s. !aludo has a amount
amount of which which the ourt also
1he body was righ
rightt to be evidence fails to show. considered
switched with treated
treated with 1he determ
determina
inatio
tion
n of  their social
anothe
anotherr en route route due courtesy the amount is left to the status.
to a diff er
erent in courtDs discretion.  ictory  A bus fell into a 1he fact of 1emperate or moderate
destin
destinati
ation.
on. 1he accordance +iner v. ravine, causing the loss having damages, which are
body arrived in the with the due ammad death of one of its been more than nominal but
Philippines one day diligence passengers. Actual established, less than compensatory,
late.
late. !aludo
!aludo suedsued reCuir
reCuired
ed by damages, death temperate may be recovered when
PA+ and 1A for law to be indemnity, and damages the court finds some
damage
damages, s, arisin
arising g exercised
exercised by compensatory should be pecuniary loss has been
from the delay and every damages, among awarded. suffered but its amount
the improper common others, was sought cannot, from the nature
behavior shown by carrier. for by the heirs of of the case, be proved
the employees. the victim. with certainty.
<A+
<A+ v.
v. A
A 1he
1he fli
fligh
ghtt to
to %an
%anilila
a /ominal 1he court may award
was cancelled due damages nominal damages in ?.A!!orne$Js ;ees an( In!eres!
to the eruption of should be every obligation arising
%t. Pinatubo. <A+ awarded. from any source (Article Rele'an! Pro'isions:
assumed the hotel  Although <A+ 4-), or in any case
expenses for an is not where any property ivil
ivil ode,Art.
ode,Art. 55@7. In !e a#sence
a#sence o0 s!i"ula!ion
s!i"ula!ion88 a!!orne$s
a!!orne$s 0ees an(
overnight stay in a obliged to right has been invaded. e<"enses
e<"enses o0 li!i)a!io
li!i)a!ion8
n8 o!er !an 7u(icial
7u(icial cos!s8 canno!
canno! #e reco'ere(8
reco'ere(8
hotel, but not defray the e<ce"!:
those for the accommodati 5,6 Wen e<e/"lar$ (a/a)es are a2ar(e(
subseCuent days. on expenses 546 Wen !e (e0en(an!s ac! or o/ission as co/"elle( !e "lain!i00 !o
1he passengers for the entire li!i)a!e 2i! !ir( "ersons or !o incur e<"enses !o "ro!ec! is in!eres!
sued <A+ for stay of the 56 In cri/inal cases o0 /alicious "rosecu!ion a)ains! !e "lain!i00
allegedly failing to passengers 5>6 In case o0 a clearl$ un0oun(e( ci'il ac!ion or "rocee(in) a)ains! !e
provide care and in <apan, it is "lain!i00
comfort to its duty6bound 56 Were !e (e0en(an! ac!e( in )r oss an( e'i(en! #a( 0ai! in re0usin) !o
stranded to ma9e the sa!is0$ !e "lain!i00s "lainl$ 'ali(8 7us! an( (e/an(a#le clai/
passengers. necessary 5?6 In ac!ions 0or le)al su""or!

??  of
 of ,- 
56 In ac!ions 0or !e reco'er$ o0 2a)es o0 ouseol( el"ers8 la#orers an( precautio
precaution,
n, and vigilance
vigilance which the circumsta
circumstances
nces #ustify
#ustify demand,
demand, whereby
whereby such
s9ille( 2or9ers other person suffers in#ury.
56
56 In ac!i
ac!ion
ons
s 0or
0or in(e
in(e/n
/ni!i!$
$ un(e
un(err 2or9
2or9/e /enns
s co/"
co/"enensa
sa!i
!ion
on an(
an(
e/"lo$ers lia#ili!$ la2s Co//on carrier is lia#le onl$ 0or (a/a)es !a! are na!ural an( "ro#a#le
56 In a se"ara!e ci'il ac!ion !o reco'er ci'il lia#ili!$ arisin) 0ro/ a cri/e conse&uence con!rac!.== here the  is guilty of a breach of 
conse&uence o0 #reac o0 con!rac!.==
5,-6 Wen a! leas! (ou#le 7u(icial cos!s are a2ar(e( contract, but acted in 2, it is liable only for the natural and probable conseCuences
5,,6 In an$ o!er case 2ere !e cour! (ee/s i! 7us! an( e&ui!a#le !a! of the breach and which the parties had foreseen or could have reasonably foreseen
a!!orne$s 0ees an( e<"enses o0 li!i)a!ion soul( #e reco'ere(. at the time the obligation was constituted (includes medical, hospital expenses)
expenses)
n all
all cases
ases,, the
the a!!orn
a!!orne$
e$s
s 0ees
0ees an( e<"ens
e<"enses es o0 li!i)
li!i)a!i
a!ion
on /us!
/us! #e
reasona#le.  Ac!ual (a/a)es.== () lost income.66 includes income to be earned by the in#ured
passenger
passenger or deceased
deceased passenger
passenger had he finished
finished his course
course (could
(could have been
ivil ode, Art. 55@. In!eres! /a$8 in !e (iscre!ion o0 !e cour!8 #e allo2e( foreseen)
u"on (a/a)es a2ar(e( 0or #reac o0 con!rac!. (5) sum being carried by the deceased passenger which was lost
(0) funeral expenses
Rele'an! A)#a$ani No!es: (?) attorneyMs fees
Da/a)es arisin) 0ro/ (ea! 0ac!ors !o #e consi(ere(== (4) loss of merchandise carried by the deceased(>)
deceased(>) loss of baggage and personal
. number of years on the basis of which the damages shall be computed belongings
5. the rate at which the losses sustained should be fixed. n the determination of the
losses or damages sustained by dependents and heirs of the deceased, said damages E<ce"!ion !o rule !a! CC is no! lia#le 0or /oral (a/a)es in #reac o0 
consist not of the full amount of his earnings, but of the support they received or con!rac!:
would have received from him had he not died in conseCuence of the negligence of  () where the mishap results in death of the passenger
defendant. (5) where it is proved that the  was guilty of fraud or "2, even if death does not
n fixing the amount of support, only net earnings are to be considered66 total result
result &x.whe
&x.where
re becau
becausese of the "2 of the , the passenpassenger
ger suffer
suffered
ed social
social
earnings less expenses necessary in the creation of such earnings less living and humiliation, wounded feelings, serious anxiety and mental anguish
incidental expenses. 'nder 55@>, the heirs of the deceased passenger may demand moral damages in an
amount commensurate
commensurate with the mental anguish suffered by them.
Da/a)es reco'era#le 2en (ea! occurs (ue !o co//ission o0 cri/e.== () n a case where the passenger suffers physical in#uries because of the Ms in#uries,
indemnity for the death of victim (P 4@1)E (5) indemnity for loss of earning capacity he cannot recover moral damages for such breach of contract since it does not fall
of the deceasedE (0) moral damagesE (?) exemplary damagesE (4) attorneyMs fees and under any of the cases where moral damages are recoverable under Art. 553.
expenses of litigationE and (>) interest. ndemnity arising from the fact of death is n determining the amount of moral damages, the trial court may consider the nature
fixed whereas the others are still sub#ect to the determination of the court based on and extent of the in#uries and the suffering occasioned by them and the duration
evidence presentedE indemnity for death is distinct and separate from the other f orms thereof.
thereof. 1he appellate
appellate court should not interfere
interfere unless such is palpably and
of indemnity scandalously excessive so as to indicate that it was the result of passion, pre#udice or
corruption on the part of the trial court.
Co//on carrier no! lia#le 0or /oral (a/a)es !o "assen)er in7ure( (ue !o  is subsidiarily liable for moral damages in actions ex delicto or where the action is
ne)li)ence o0 (ri'er.==  A Ms bad faith is not to be lightly inferred from a mere based upon its liability arising from a crime.
finding that the contract was breached through negligence of the Ms employees.  is not ordinarily
ordinarily liable for exemplary
exemplary or corrective
corrective damages
damages based upon the
wrongful act of its && or driver where it did not have anything to do with the wrongful
E<!en! o0 lia#ili!$ o0 air carrier 0or ( ea! o0 "assen)er: act or had not previously authori8ed or subseCuently ratified such act (Art. 5005) 1his
() where there was no satisfactory explanation on the part of PA+ as to how and cannot be presumed but must be proven by evidenceE exemplary damages cannot be
why the accident occurred, the presumption is that it was at fault, under Art. -4> recovered as a matter of right.
(5) liability for lost earnings are the deceased passengerMs net earnings during his here the  has incurred in delay in the delivery of the luggage of the offended
expected length of life based on accepted mortality tables (compensatory damages) party, but it had not acted in bad faith nor been guilty of gross negligence, the
(0) PA+ is not liable for exemplary damages where it was not proven that it acted in a offended party is not entitled to moral nor exemplary damages but only to the limited
wanton, fraudulent, rec9less, oppressive or malevolent manner amount printed in the plane tic9et where the offended party had not declared a
higher value nor paid addtl. transpo charges.
Da/a)es cause( #$ CC on !ir( "ersons.== /egligence
/egligence refers to the failure to
observe for the protection of the interests of another person that degree of care, Lia#ili!$ o0 air carriers 0or /oral an( e<e/"lar$ (a/a)es.== () 'nder the pool
arrangement among different airlines of the A1A agreement of which Alitalia and

?  of
 of ,- 
+ufthansa are signatories, both airlines are constituted as agents of each other in the
issuing of tic9ets and other matters pertaining to their relations with those who would D. Con!ra
Con!rac! c! o0 Carria
Carria)e
)e
need their services. ,. Bill o0 La(in)
(5) hen it comes to contracts of common carriage, inattention and lac9 of care on 5a6 De0ini!io
De0ini!ion8n8 Su#7ec!
Su#7ec! *a!!er
the part of the  resulting in the failure of the passenger to be accommodated in
the class contracted for amounts to "2 or fraud which entitles the passenger to the  Article 045 . 1he bills of lading, or tic9ets in cases of transportation of passengers,
award
award of moral
moral damage
damages.s. here
here the passenge
passengerMs
rMs seat was given to a white
white may be diverse, some for persons and others for baggageE but all of them shall bear
passenger, there is willful breach giving rise to an action for moral damages. the name of the carrier, the date of shipment, the points of departure and arrival, the
(0) &xemplary damages were awarded. Befendant as an airline should be made to cost, and, with respect to the baggage, the number and weight of the pac9ages, with
pay an amount that can really serve as a deterrent against a seeming pattern of  such other manifestat
manifestations
ions which may be considere
considered
d necessary
necessary for their easy
indifference and unconcern, and discrimination for racial reasons, discernible in the identification.
treatment of air passengers.
 5#6 ;or/8 Con!en!s

(+ore Agliam)   Article 04@ . 1he shipper as well as the carrier of merchandise or goods may mutually
IV. Co(e o0 Co//erce Pro'isions on O'erlan( Trans"or!a!ion demand that a bill of lading be made, stating:
('nless otherwise indicated, reference is to ode of ommerce) . 1he name, surname and residence of the shipper.
5. 1he name, surname and residence of the carrier.
 A. Sco"e o0 O'erloa( Trans"or!a!ion 0. 1he name, surname and residence of the person to whom or to whose order the
goods are to be sent or whether they are to be delivered to the bearer of said bill.
No!e: 1here is no distinction between a transportation contract of a common carrier ?. 1he description of the goods, with a statement of their 9ind, of their weight, and of 
under the ivil ode and a transportation contract under the ode of ommerce. "ut, the external mar9s or signs of the pac9ages in which they are contained.
the ivil ode does not expressly repeal the provisions of the ode of ommerce on 4. 1he cost of transportation.
overland
overland transportation
transportation.. nstead,
nstead, it ma9es
ma9es such provisions
provisions suppletor
suppletoryy to the >. 1he date on which shipment is made.
provisions of the ivil ode on common carriers. -. 1he place of delivery to the carrier.
7. 1he place and the time at which delivery to the consignee shall be made.
B. Na!u
Na!ure
re o0 Con
Con!r
!rac
ac!! 3. 1he indemnity to be paid by the carrier in case of delay, if there should be any
agreement on this matter.
 Article 0?3 . A contract of transportation by land or water ways of any 9ind shall be  Article 04. n transportatio
transportation
n made by railroads
railroads or other enterprises
enterprises sub#ect
sub#ect to
considered commercial: regulation rate and time schedules, it shall be sufficient for the bills of lading or the
. hen it has for its ob#ect merchandise or any article of commerce. declaration of shipment furnished by the shipper to refer, with respect to the cost,
5. hen, whatever its ob#ect may be, the carrier is a merchant or is habitually time and special conditions of the carriage, to the schedules and regulations the
engaged in transportation for the public. application of which he reCuestsE and if the shipper does not determine the schedule,
the carrier must apply the rate of those which appear to be the lowest, with the
C. E00e
E00ec!
c! o0
o0 Ci'i
Ci'ill Co(e
Co(e conditions inherent thereto, always including a statement or reference to in the bill of 
lading which he delivers to the shipper.
 Article ->>, ivil ode . n all matters not regulated by this ode, the rights and
obligations of common carriers shall be governed by the ode of ommerce and by 5c6 ;unc!ion
special laws.
 Article 040.  1he legal evidence of the contract between the shipper and the carrier
 Article 55-@, ivil ode . 1he following laws and regulations are hereby repealed: shall be the bills of lading, by the contents of which the disputes which may arise
() 1hose parts and provisions of the ivil ode of 773 which are in force on the regarding their execution and performance shall be decided, no exceptions being
date when this new ivil ode becomes effective: admissible other than those of falsity and material error in the drafting.
(5) 1he provisions of the ode of ommerce governing sales, partnership, agency,  After the contract has been complied with, the bill of lading which the carrier has
loan, deposit and guarantyE issued shall be returned to him, and by virtue of the exchange of this title with the
(0) 1he provisions of the ode of ivil Procedure on prescription as far as inconsistent thing transported,
transported, the respective
respective obligations
obligations and actions
actions shall be considere
considered
d
with this odeE and cancelled, unless in the same act the claim which the parties may wish to reserve be
(?) All laws, Acts, parts of Acts, rules of court, executive orders, and administrative reduced to writing, with the exception of that provided for in Article 0>>.
regulations which are inconsistent with this ode.

?  of
 of ,- 
n case the consignee, upon receiving the goods, cannot return the bill of lading
subscribed by the carrier, because of its loss or of any other cause, he must give the
latter a receipt for the goods delivered, this receipt producing the same effects as the
return of the bill of lading.
4. Re0usal !o Trans"or!
 Article 04>.  arriers may refuse pac9ages which appear unfit for transportationE and
if thecarriage is to be made by railway, and the shipment is insisted upon, the
company shall transport them, being exempt from all responsibility if its ob#ections, is
made to appear in the bill of lading.
. Dou#!0ul (eclara!ion o0 con!en!s
 Article 04-. f by reason of well6founded suspicion of falsity in the declaration as to
the contents of a pac9age the carrier should decide to examine it, he shall proceed
with his investigation in the presence of witnesses, with the shipper or consignee in
attendance.
f the shipper or consignee who has to be cited does not attend, the examination
shall be made before a notary, who shall prepare a memorandum of the result of the
investigation, for such purposes as may be proper.
f the declaration of the shipper should be true, the expense occasioned by the
examination and that of carefully repac9ing the pac9ages shall be for the account of  shipper has committed fraud in the bill of lading, representing the goods to be of a
the carrier and in a contrary case for the account of the shipper.
>. No Bill o0 La(in)
 Article 04? . n the absence of a bill of lading, disputes shall be determined by the
legal proofs which the parties may present in support of their respective claims,
according to the general provisions established in this ode for commercial contracts.
 Article 4 . ommercial contracts shall be valid and shall give rise to obligations and
causes of action in suits, whatever the form and language in which they may be
executed, the class to which they may belong, and the amount they may involve,
provided their existence is shown by any means established by the civil law.
;owever, the testimony of witness alone shall not be sufficient to prove the existence
of a contract which involves an amount exceeding ,4@@ pesetas unless supported by
some other evidence.
E. Res"onsi#ili!$ o0 !e Carrier
,. Wen i! co//ences
 Article 044.  1he responsibility of the carrier shall commence from the moment he
receivesthe merchandise, personally or through a person charged for the purpose, at
the place indicated for receiving them.
4. Rou!e
 Article 043. f there is an agreement between the shipper and the carrier as to the
road over which the conveyance is to be made, the carrier may not change the route,
unless it be by reason of force ma#eureE and should he do so without this cause, he
shall be liable for all the losses which the goods he transports may suffer from any
other cause, beside paying the sum which may have been stipulated for such case.
hen on account of said cause of force ma#eure, the carrier had to ta9e another
route which produced an increase in transportation charges, he shall be reimbursed
for such increase upon formal proof thereof.
. Care o0 Goo(s
 Article 0>. 1he merchandise shall be transported at the ris9 and venture of the
shipper, if the contrary has not been expressly stipulated.
 As a conseCuence, all the losses and deteriorations which the goods may suffer
during the transportation by reason of fortuitous event, force ma#eure, or the
inherent nature and defect of the goods, shall be for the account and ris9 of the
shipper. Proof of these accidents is incumbent upon the carrier.
 Article 0>5 . /evertheless, the carrier shall be liable for the losses and damages
resulting from the causes mentioned in the preceding article if it is proved, as against
him, that they arose through his negligence or by reason of his having failed to ta9e
the precautions which usage has established among careful persons, unless the
9ind or Cuality different from what they really were.
f, notwithstanding the precautions referred to in this article, the goods transported
run the ris9 of being lost, on account of their nature or by reason of unavoidable
accident, there being no time for their owners to dispose of them, the carrier may
proceed to sell them, placing them for this purpose at the disposal of the #udicial
authority or of the officials designated by special provisions.
 Article -0?, ivil ode.  ommon carriers are responsible for the loss, destruction, or
deterioration of the goods, unless the same is due to any of the following causes
only:
() 2lood, storm, earthCua9e, lightning, or other natural disaster or calamityE
(5) Act of the public enemy in war, whether international or civilE
(0) Act or omission of the shipper or owner of the goodsE
(?) 1he character of the goods or defects in the pac9ing or in the containersE
(4) rder or act of competent public authority.
 Article -04, ivil ode.  n all cases other than those mentioned in /os. , 5, 0, ?,
and 4 of the preceding article, if the goods are lost, destroyed or deteriorated,
common carriers are presumed to have been at fault or to have acted negligently,
unless they prove that they observed extraordinary diligence as reCuired in Article
-00.
>. Deli'er$
5a6 Con(i!ion o0 Goo(s
?  of ,- 
 Article 0>0. utside of the cases mentioned in the second paragraph of Article 0>,
the carrier shall be obliged to deliver the goods shipped in the same condition in
which, according to the bill of lading, they were found at the time they were received,
without any damage or impairment, and failing to do so, to pay the value which those
not delivered may have at the point and at the time at which their delivery should
have been made.
f those not delivered form part of the goods transported, the consignee may refuse
to receive the latter, when he proves that he cannot ma9e use of them independently
of the others.
 Article 0>? . f the effect of the damage referred to in Article 0> is merely a
diminution in the value of the goods, the obligation of the carrier shall be reduced to
the payment of the amount which, in the #udgment of experts, constitutes such
difference in value.
 Article 0>4.  f, in conseCuence of the damage, the goods are rendered useless for
sale and consumption for the purposes for which they are properly destined, the
consignee shall not be bound to receive them, and he may have them in the hands of  within such time, and, for failure to do so, the carrier shall pay the indemnity
the carrier, demanding of the latter their value at the current price on that day.
f among the damaged goods there should be some pieces in good condition and
without any defect, the foregoing provision shall be applicable with respect to those
damaged and the consignee shall receive those which are sound, this segregation to
be made by distinct and separate pieces and without dividing a single ob#ect, unless
the consignee proves the impossibility of conveniently ma9ing use of them in this
form.
1he same rule shall be applied to merchandise in bales or pac9ages, separating those
parcels which appear sound.
 Article 0>> . ithin the twenty6four hours following the receipt of the merchandise,
the claim against the carrier for damage or average be found therein upon opening
the pac9ages, may be made, provided that the indications of the damage or average
which gives rise to the claim cannot be ascertained from the outside part of such
pac9ages, in which case the claim shall be admitted only at the time of receipt.
 After the periods mentioned have elapsed, or the transportation charges have been
paid, no claim shall be admitted against the carrier with regard to the condition in
which the goods transported were delivered.
No!es:
 Art 0>> is applicable to maritime shipments$transportation.
  After the periods mentioned have elapsed, or the transportation charges have been
1he purpose of stipulation reCuiring presentation of claims within short period of  paid, no claim shall be admitted against the carrier with regard to the condition in
time is to afford the carrier$depositary a reasonable opportunity and facilities to
chec9 the validity of the claims while the facts are still fresh in the minds of the
persons who too9 part in the t ransaction and the document are still available
 Article 0>- . f doubts and disputes should arise between the consignee and the
carrier with respect to the condition of the goods transported at the time their
delivery to the former is made, the goods shall be examined by experts appointed by
the parties, and, in case of disagreement, by a third one appointed by the #udicial
authority, the results to be reduced to writingE and if the interested parties should not
agree with the expert opinion and they do not settle their differences, the
merchandise shall be deposited in a safe warehouse by order of the #udicial authority,
and they shall exercise their rights in the manner that may be proper.
5#6 To Wo/ Deli'er$ *a(e
 Article 0>7. 1he carrier must deliver to the consignee, without any delay or
obstruction, thegoods which he may have received, by the mere fact of being named
in the bill of lading to receivethemE and if he does not do so, he shall be liable for the
damages which may be caused thereby.
No!e: A provision in the bill of lading establishing a condition precedent in case of 
non6delivery does not apply to a case of misdelivery.
5c6 Wen !o #e /a(e
 Article 0-@. f a period has been fixed for the delivery of the goods, it must be made
stipulated in the bill of lading, neither the shipper nor the consignee being entitled to
anything else.
f no indemnity has been stipulated and the delay exceeds the time fixed in the bill of 
lading, the carrier shall be liable for the damages which the delay may have caused.
 Article 047 . f there is no period fixed for the delivery of the goods the carrier shall be
bound to forward them in the first shipment of the same or similar goods which he
may ma9e point where he must deliver themE and should he not do so, the damages
caused by the delay should be for his account.
;. Ri)!s an( O#li)a!ions or Si""er an(For Consi)nee
,. Ri)! !o (a/a)es
5a6 Con(i!ion i/"ose( on ri)!
 Article 0>> . ithin the twenty6four hours following the receipt of the merchandise,
the claim against the carrier for damage or average be found therein upon opening
the pac9ages, may be made, provided that the indications of the damage or average
which gives rise to the claim cannot be ascertained from the outside part of such
pac9ages, in which case the claim shall be admitted only at the time of receipt.
which the goods transported were delivered.
 Article 04- . f by reason of well6founded suspicion of falsity in the declaration as to
the contents of a pac9age the carrier should decide to examine it, he shall proceed
with his investigation in the presence of witnesses, with the shipper or consignee in
attendance.
f the shipper or consignee who has to be cited does not attend, the examination
shall be made before a notary, who shall prepare a memorandum of the result of the
investigation, for such purposes as may be proper.
-  of ,- 
f the declaration of the shipper should be true, the expense occasioned by the
examination and that of carefully repac9ing the pac9ages shall be for the account of  the shipper.
the carrier and in a contrary case for the account of the shipper.
5#6 A/oun! o0 (a/a)es 0or loss
 Article -05.  +enders on bottomry or respondentia shall suffer, in proportion to their
respective interest, the general average which may ta9e place in the goods on which
the loan is made.
n particular averages, in the absence of an express agreement between the
contracting parties, the lender on bottomry or respondentia shall also contribute in
proportion to his respective interest, should it not belong to the 9ind of ris9s excepted
in the foregoing article.
 Article -??, ivil ode . A stipulation between the common carrier and the shipper or
owner limiting the liability of the former for the loss, destruction, or deterioration of 
the goods to a degree less than extraordinary diligence shall be valid, provided it be:
() n writing, signed by the shipper or ownerE
(5) !upported by a valuable consideration other than the service rendered by the
common carrierE and
(0) Reasonable, #ust and not contrary to public policy.
5c6 A/oun! o0 Da/a)es 0or (ela$
 Article 0- (0) . f the abandonment is not made, the indemnification for losses and
damages by reason of the delay cannot exceed the current price which the goods
transported would have had on the day and at the place in which they should have
been deliveredE this same rule is to be observed in all other cases in which this
indemnity may be due.
4. Ri)! !o a#an(on8 Ar!s. ,8 ?-8 ?8 ?
 Article 0-. n case of delay through the fault of the carrier, referred to in the
preceding articles, the consignee may leave the goods transported in the hands of 
the former, advising him thereof in writing before their arrival at the point of   Article 0>@ . 1he shipper, without changing the place where the delivery is to be
destination.
hen this abandonment ta9es place, the carrier shall pay the full value of the goods
as if they had been lost or mislaid.
f the abandonment is not made, the indemnification for losses and damages by
reason of the delay cannot exceed the current price which the goods transported
would have had on the day and at the place in which they should have been
deliveredE this same rule is to be observed in all other cases in which this indemnity
may be due.
 Article 0>@ . 1he shipper, without changing the place where the delivery is to be
made, may change the consignment of the goods which he delivered to the carrier,
provided that at the time of ordering the change of consignee the bill of lading signed
by the carrier, if one has been issued, be returned to him, in exchange for another
wherein the novation of the contract appears.
1he expenses which this change of consignment occasions shall be for the account of 
 Article 0>4 . f, in conseCuence of the damage, the goods are rendered useless for
sale and consumption for the purposes for which they are properly destined, the
consignee shall not be bound to receive them, and he may have them in the hands of 
the carrier, demanding of the latter their value at the current price on that day.
f among the damaged goods there should be some pieces in good condition and
without any defect, the foregoing provision shall be applicable with respect to those
damaged and the consignee shall receive those which are sound, this segregation to
be made by distinct and separate pieces and without dividing a single ob#ect, unless
the consignee proves the impossibility of conveniently ma9ing use of them in this
form.
1he same rule shall be applied to merchandise in bales or pac9ages, separating those
parcels which appear sound.
 Article 0>0.  utside of the cases mentioned in the second paragraph of Article 0>,
the carrier shall be obliged to deliver the goods shipped in the same condition in
which, according to the bill of lading, they were f ound at the time they w ere received,
without any damage or impairment, and failing to do so, to pay the value which those
not delivered may have at the point and at the time at which their delivery should
have been made.
f those not delivered form part of the goods transported, the consignee may refuse
to receive the latter, when he proves that he cannot ma9e use of them independently
of the others.
No!es:
nstances where consignee may abandon goods:
. Art 00>, partial non6delivery
5. Art 0>4, goods are rendered useless for sale and consumption
0. Art 0-, delay through carrierDs fault
. Ri)! !o can)e consi)n/en!
made, may change the consignment of the goods which he delivered to the carrier,
provided that at the time of ordering the change of consignee the bill of lading signed
by the carrier, if one has been issued, be returned to him, in exchange for another
wherein the novation of the contract appears.
1he expenses which this change of consignment occasions shall be for the account of 
the shipper.
>. O#li)a!ion !o "a$ !rans"or!a!ion car)es
 Article 0->. 1he preference of the carrier to the payment of what is owed him for the
transportation and expenses of the goods delivered to the consignee shall not be cut
off by the ban9ruptcy of the latter, provided it is claimed within the eight days
mentioned in the preceding article.
, of ,- 
 Article 55? . ith reference to specific movable property of the debtor, the following
claims or liens shall be preferred:
(3) redits for transportation, upon the goods carried, for the price of the contract
and incidental expenses, until their delivery and for thirty days thereafter.
. O#li)a!ion !o re!urn #ill o0 la(in)
 Article 040 (5). After the contract has been complied with, the bill of lading which the
carrier has issued shall be returned to him, and by virtue of the exchange of this title
with the thing transported, the respective obligations and actions shall be considered
cancelled, unless in the same act the claim which the parties may wish to reserve be
reduced to writing, with the exception of that provided for in Article 0>>.
() &xclusive original #urisdiction over civil actions and probate proceedings, testate
and intestate, including the grant of provisional remedies in proper cases, where
the value of the personal property, estate, or amount of the demand does not
exceed ne hundred thousand pesos (P@@,@@@.@@) or, in %etro %anila where
such personal property, estate, or amount of the demand does not exceed 1wo
hundred thousand pesos (P5@@,@@@.@@) exclusive of interest damages of
whatever 9ind, attorneyMs fees, litigation expenses, and costs, the amount of
which must be specifically alleged: Provided, 1hat where there are several
claims or causes of action between the same or different parties, embodied in
the same complaint, the amount of the demand shall be the totality of the
claims in all the causes of action, irrespective of whether the causes of action
arose out of the same or different transactionsE

G. A""lica#ili!$ o0 Pro'isions
RA 7691, Section 5. After ive (5) years from
the effectivity of this Act, the jurisdictiona
 Article 0-3 . 1he provisions contained in Articles 0?3 and following shall be
understood as eCually applicable to those who, although they do not personally effect amounts mentioned in Sec. 19(!), ("), and
the transportation of the merchandise, contract to do so through others, either as
contractors for a particular and definite operation, or as agents for transportations (#)$ and Sec. !!(1) of %atas &am'ansa %.
and conveyances.
n either case they shall be subrogated in the place of the carriers themselves, with
19 as amended 'y this Act, sha 'e
respect to the obligations and responsibility of the latter, as well as with regard to adjusted to *+o hundred thousand esos
their rights.
(&--,---.--). ive (5) years thereafter,
 V. AD*IRALTY AND *ARITI*E CO**ERCE
('nless otherwise indicated, reference is to ode of ommerce) such jurisdictiona amounts sha 'e
 A. Conce"! o0 A(/iral!$ Kuris(ic!ion o'er a(/iral!$ cases
adjusted further to *hree hundred
thousand esos (&!--,---.--)/ &rovided,
"P 53, !ec. 3 (0), !ec. 00(), as amended by R.A. ->3
ho+ever, *hat in the case of 0etro 0ania,
!ection 3. <urisdiction in civil cases. T Regional 1rial ourts shall exercise exclusive
original #urisdiction:
the a'ovementioned jurisdictiona
(0) n all actions in a(/iral!$ an( /ari!i/e 7uris(ic!ion  where he demand or amounts sha 'e adjusted after ive (5)
claim exceeds ne hundred thousand pesos (P@@,@@@.@@) or , in %etro %anila,
where such demand or claim exceeds 1wo hundred thousand pesos (5@@,@@@.@@)E years from the effectivity of this Act to our
!ection 00. <urisdiction of %etropolitan 1rial ourts, %unicipal 1rial ourts and hundred thousand esos (&"--,---.--).
%unicipal ircuit 1rial ourts in civil cases. T %etropolitan 1rial ourts, %unicipal 1rial
ourts, and %unicipal ircuit 1rial ourts shall exercise:
A!& 2A1! ;&+B B1R/& +A!! /1&!
nternational !hipper filed %1 has no 1he 1he amount of 
;arvester v. for recovery of   #urisdiction  #urisdiction of demand or
 Aragon the amount of over admiralty admiralty in claim
its undelivered matters but matters of determines the
cargo against the 2 contract  #urisdiction.
the vesselDs depends upon
agent before the sub#ect6
%1 on the matter.
ground of
negligence 4  of ,- 
 n the absence of any of these reCuisites, continuous possession for ten years shall
B. Ves sels be necessary in order to acCuire ownership.
,. *eanin)  A captain may not acCuire by prescription the vessel of which he is in command.

No!es: IesselsJ governed by the ode of ommerce are licensed to engage in
maritime commerce or commerce by sea, whether in foreign or coastwise trade.
e.g. merchant ships, launches, lifeboats, boat, banca, those which are engaged in the
transportation of passengers and freight from one port$place to another.
/ot vessels: warships or patrol vessels, pleasure craft, yachts, pontoons, health
service and harbor police vessels, floating storehouses, coast guard vessels, fishing
vessels, towboats
 IesselsJ for purposes of registration under Revised Admin ode include Ievery sort
of boat, craft, or other artificial contrivance used, or capable of being used, as a
means of transportation on water.J  ode, vessels shall continue to be considered as personal property.
No!e: Art. 4-0 (5) = (?) govern acCuisition of vessel by prescription. All the
reCuisites of par. 5 must be complied with. %eans of acCuiring vessels: sale,
prescription, capture, construction, donation, succession, barter
 Article 4-? . "uilders of vessels may employ the materials and follow, with respect to
their construction and rigging, the systems most suitable to their interests. !hip
owners and seamen shall be sub#ect to what the laws and regulations of the public
administration on navigation, customs, health, safety of vessels, and other similar
matters.
 Article 474. 2or all purposes of law not modified or restricted by the provisions of this

A!& 2A1! ;&+B$RA1 B1R/& +A!! No!e: 'nder Art. 474, vessels are considered personal$movable property. "ut
/1&! whether moved by steam or sail, they parta9e to a certain extent, of the nature and
+ope8 v. Passenger  A boat  essels of a minor conditions of real property, on account of their value and importance in the world of
Buruelo see9s to passenger is not nature not engaged commerce.
recover reCuired to in maritime  Article -5, ivil ode. wnership is acCuired by occupation and by intellectual
damages for ma9e protest as commerce, such as creation.
the in#uries he a condition river boats and those wnership and other real rights over property are acCuired and transmitted by law,
sustained precedent to his carrying passengers by donation, by estate and intestate succession, and in conseCuence of certain
while aboard a right of action from ship to shore, contracts, by tradition.
motor boatE for the in#ury must be governed, 1hey may also be acCuired by means of prescription.
passenger did suffered by him as to their liability to
not protest since the boat is passengers, by the B. Re)is!ra!ion cer!i0ica!es issue( (is!inc!ions
within 5? not licensed to provisions of the ivil RA 3534, !ection @(): <urisdictionE PowerE and Buties of %AR/A.
hours of the engage in ode or other 1he %AR/A shall have the power and authority to:
accident maritime appropriate special () Register vessels
commerce, provisions of law.
whether in No!e: Registration is necessary and indispensable in order that a purchaserDs rights
foreign or may be maintained against a claim filed by a 0rd person. 1hus a registered sale at a
coastwise trade, public auction shall prevail over a prior unregistered sale.
as regulated by
the ode of >. Si)ni0icance o0 re)is!ra!ion o0 !ransac!ions a00ec!in) 'essels
ommerce.
A!& 2A1! ;&+B$RA1 B1R/& +A!!
 A. Na!ure an( ac&uisi!ion o0  /1&!
 Arroyo 1he sub#ect vessels  Although there t is essential that a
 Article 4-0 . %erchant vessels constitute property which may be acCuired and v. Gu were mortgaged in was delay in record of documents
transferred by any of the means recogni8ed by law. 1he acCuisition of a vessel must favor of P/". registration of affecting the title of
appear in a written instrument, which shall not produce any effect with respect to 1hereafter, the the mortgage a vessel be entered
third persons if not inscribed in the registry of vessels. sub#ect vessels before the in the office of the
were later attached ustoms, it was collector of customs,
1he ownership of a vessel shall li9ewise be acCuired by possession in good faith, by the ownerDs not P/"Ds fault. at a port of entry to
continued for three years, with a #ust title duly recorded.  #udgment creditor. 1he ourt bind third persons.

:  of ,- 
 deemed it as goods which he loaded on the vesselE but he may exempt himself therefrom by
constructive abandoning the vessel with all her eCuipments and the freight it may have earned
registration so during the voyage.
P/" has the
superior right  Article 477. /either the shipowner nor the ship agent shall be liable for the
over the obligations contracted by the captain, if the latter exceeds the powers and privileges
 #udgment pertaining to him by reason of his position or conferred upon him by the former.
creditor. /evertheless, if the amounts claimed were invested for the benefit of the vessel, the
Rubiso Rivera purchased t was Rubiso 1he acCuisition of a responsibility therefor shall devolve upon its owner or agent
v. from the owner the who first vessel must be
Rivera sub#ect vessel registered his included in a written  Article 473. f two or more persons should be part owners of a merchant vessel, an
through a private acCuisition of the instrument which association shall be presumed as established by the part owners.
sale. 1hereafter, vessel so he is shall not produce 1his association shall be governed by the resolutions of a ma#ority of the members.
Rubiso bought the the one entitled any effect with  A ma#ority shall be the relative ma#ority of the voting members.
same vessel to en#oy the regard to third f there should be only two part owners, in case of disagreement the vote of the
through a public protection of the persons if not member having the largest interest shall be decisive. f the interests are eCual, it
auction. Rubiso was law, which recorded in the shall be decided by lot.
the first one who considers him commercial registry. 1he representation of the smallest part in the ownership shall have one voteE and
registered it before the absolute proportionately the other part owners as many votes as they have parts eCual to the
the collector of owner of the smallest one.
customs. purchased boat.  A vessel cannot be detained, attached or levied upon execution in her entirety for the
private debts of a part owner, but the proceedings shall be limited to the interest the
debtor may have in the vessel, without interfering with her navigation.
,. Persons Par!ici"a!in) in *ari!i/e Co//erce
 Article 43@. 1he co6owners of a vessel shall be civilly liable in the proportion of their
No!es: Persons who participate: () shipowner, (5) ship agent, (0) captain$master, interests in the common fund, for the results of the acts of the captain, referred to in
(?) other officers i.e., sailing$ st mate, Cuartermaster$5nd mate and engineer, (4)  Article 47-.
seamen, and (>) other persons who ma9e up the complement of the vessel (including &ach co6owner may exempt himself from this liability by the abandonment, before a
the sto9ers = supercargo) notary, of the par tof the vessel belonging to him.
!hipagent O appointed to manage and operate the vessels of the shipowner, bound
to Iprovisions and victualJ them, and to render reports on the operations of the  Article 43. All the part owners shall be liable, in proportion to their respective
vessels, authori8ed to appoint sub6agents remaining responsible to the shipowner ownership, for the expenses of repairs to the vessel, and for other expenses which
omplement O all the persons on board, from the captain to the cabin boy, necessary are incurred by virtue of a resolution of the ma#ority.
for the management, maneuvers and service. 1hey shall li9ewise be liable in the same proportion for the expenses of maintenance,
omplement includes crews (i.e., sailing mates, engineers, sto9ers and other eCuipment, and provisioning of the vessel, necessary for navigation.
employees on board not having specific designations)E but not includes passengers or
persons who, the vessel is transporting  Article 435 . 1he resolutions of the ma#ority with regard to the repair, eCuipment, and
provisioning of the vessel in the port of departure shall bind the ma#ority unless the
Rele'an! "ro'isions: partners in the minority renounce t heir participation therein, which must be acCuired
by the other part owners after a #udicial appraisement of the value of the portion or
 Article 47>. 1he shipowner and the ship agent shall be civilly liable for the acts of the portions assigned.
captain and for the obligations contracted by the latter to repair, eCuip, and provision 1he resolutions of the ma#ority relating to the dissolution of the association and sale
the vessel, provided the creditor proves that the amount claimed was invested for the of the vessel shall also be binding on the minority.
benefit of the same. 1he sale of the vessel must ta9e place at a public auction, sub#ect to the provisions of 
"y ship agent is understood the person entrusted with provisioning or representing the law of civil procedure unless the part owners unanimously agree otherwise, the
the vessel in the port in which it may be found. right of option to purchase and to withdraw mentioned in Article 4-4 being always
reserved in favor of said part owners.
 Article 47-. 1he ship agent shall also be civilly liable for the indemnities in favor of
third persons which may arise from the conduct of the captain in the care of the

>  of ,- 
 Article 430 . 1he owners of a vessel shall have preference in her charter to other
persons, offering eCual conditions and price. f two or more of the former should  
claim said right the one having greater interest shall be preferred, and should they
have an eCual interest it shall be decided by lot.
 Article 43? . 1he co6owners shall elect the manager who is to represent them in the
capacity of ship agent.  
1he appointment of director or ship agent shall be revocable at the will of the
members.
 Article 434. 1he agent, be he at the same time an owner of a vessel or a manager for  
an owner or for an association of co6owners, must be Cualified to trade and must be
recorded in the merchantMs registry of the province.
1he agent shall represent the ownership of t he vessel, and may in his own name and
in such capacity ta9e #udicial and extra#udicial steps in all that relates to commerce.
 Article 43>. 1he agent may discharge the duties of captain of the vessel, sub#ect, in  
every case, to the provisions contained in Article >@3.
f two or more co6owners reCuest the position of captain, the disagreement shall be
decided by a vote of the membersE and if the vote should result in a tie, the position
shall be given to the part owner having the larger interest in the vessel.
f the interest of the petitioners should be the same, and there should be a tie, the  
matter shall be decided by lot.
 Article 43-. 1he agent shall select and come to an agreement with the captain, and
shall contract in the name of the owners, who shall be bound in all that refers to
repairs, details of eCuipment, armament, provisions, fuel, and freight of the vessel,
and, in general, in all that relates to the reCuirements of navigation.  
 Article 437. 1he agent cannot order a new voyage, nor ma9e contracts for a new
charter, nor insure the vessel, without the authority of her owner or by virtue of a
resolution of the ma#ority of the co6owners, unless these privileges were granted him
in the certificate of his appointment.  
f he should insure the vessel without authority therefor he shall be secondarily liable
for the solvency of the underwriter.
 Article 433. 1he managing agent of an association, shall give his co6owners an  
account of the results of each voyage of the vessel, without pre#udice to always
having the boo9s and correspondence relating to the vessel and to its voyages at the
disposal of the same.
 Article >@@. After the account of the managing agent has been approved by a relative
ma#ority, the co6owners shall satisfy the expenses in proportion to their interest,
without pre#udice to the civil or criminal actions which the minority may deem fit to  
institute afterwards.
n order to enforce the payment, the managing agent shall have a right of action to
secure execution, which shall be instituted by virtue of a resolution of the ma#ority,
and without further proceedings than the ac9nowledgment of the signatures of the
persons who voted the resolution.
Article >@. !hould there be any profits, the co6owners may demand of the managing
agent the amount due them, by means of an executory action without further
reCuisites than the ac9nowledgment of the signatures of the instrument approving
the account.
Article >@5 . 1he agent shall indemnify the captain for all the expenses he may have
incurred from his own funds or from those of other persons, for the benefit of the
vessel.
Article >@0 . "efore a vessel goes out to sea the agent shall have at his discretion, a
right to discharge the captain and members of the crew whose contract did not state
a definite period nor a definite voyage, paying them the salaries earned according to
their contracts, and without any indemnity whatsoever, unless there is a special and
specific agreement in respect thereto.
Article >@?. f the captain or any other member of the crew should be discharged
during the voyage, they shall receive their salary until the return to the place where
the contract was made, unless there are good reasons for the discharge, all in
accordance with Articles >0> et seC. of this code.
Article >@4. f the contracts of the captain and members of the crew with the agent
should be for a definite period or voyage, they cannot be discharged until the
fulfillment of their contracts, except for reasons of insubordination in serious matters,
robbery, theft, habitual drun9enness, and damage caused to the vessel or to its cargo
by malice or manifest or proven negligence.
Article >@>. f the captain should be a co6owner of the vessel, he may not be
discharged unless the ship agent returns to him the amount of his interest therein,
which, in the absence of agreement between the parties, shall be appraised by
experts appointed in the manner established in the law of civil procedure.
Article >@-. f the captain who is a co6owner should have obtained the command of
the vessel by virtue of a special agreement contained in the articles of association, he
may not be deprived of his office except for the causes mentioned in Article >@4.
Article >@7 . n case of the voluntary sale of the vessel, all contracts between the
agent and captain shall terminate, the right to proper indemnity being reserved in
favor of the captain, according to the agreements made with the agent.
1he vessel sold shall remain sub#ect to the security of the payment of said indemnity
if, after the action against the vendor has been instituted, the latter should be
insolvent.
Article >7. 1he captain shall be civilly liable to the agent, and the latter to the third
persons who may have made contracts with the formerE
. 2or all the damages suffered by the vessel and his cargo by reason of want
of s9ill or negligence on his part. f a misdemeanor or crime has been
committed he shall be liable in accordance with the Penal ode.
  of ,- 
 5. 2or all the thefts committed by the crew, reserving his right of action against crew are voyage. Any owner of the cargo.
the guilty parties. supplied and person whose ship, leaving
0. 2or the losses, fines, and confiscations imposed an account of violation of controlled by property may him to obtain
the laws and regulations of customs, police, health, and navigation. the owner have been cast recourse, as it
?. 2or the losses and damages caused by mutinies on board the vessel, or by astelo. overboard by is very easy to
reason of faults committed by the crew in the service and defense of the Petroleum was the captainDs do, from other
same, if he does not prove that he made full use of his authority to prevent placed upon order should individuals
or avoid them. the shipDs dec9 have a right of who have
4. 2or those arising by reason of an undue use of powers and non6fulfillment of  and due to the action directly been drawn
the obligations which are his in accordance with Articles >@ and >5. typhoon, the against the into the
>. 2or those arising by reason of his going out of his course or ta9ing a course captain was shipowner for venture as
which he should not have ta9en without sufficient cause, in the opinion of compelled to the breach of shippers.
the officers of the vessel, at a meeting with the shippers or supercargoes  #ettison the any duty which
who may be on board. /o exception whatsoever shall exempt him from this entire the law may
obligation. consignment of  have imposed
-. 2or those arising by reason of his voluntarily entering a port other than his petroleum. on the captain
destination, with the exception of the cases or without the formalities with respect to
referred to in Article >5. such cargo.
7. 2or those arising by reason of the non6observance of the provisions
contained in the regulations for lights and evolutions for the purpose of 5a6 Res"onsi#ili!ies an( lia#ili!ies
preventing collisions.
A!& 2A1! ;&+B$RA1 B1R/& +A!!
No!es: /1&!
1he shipowner and the ship agent are primarily liable for the ff:  Gu on v. pil Gu on 1he master 1he shipowner
() Acts of the captain (Art 47-) chartered and may not be
(5) ontracts entered into by the captain to repair, eCuip, and provision the +auronDs supercargo not held
vessel, provided that the amount claimed was invested for the benefit of the banca for the were the criminally
vessel (Art 47-) transportation depositaries of  liable for such
(0) ndemnities in favor of 0rd persons which may arise from the captainDs of his P?4@ and crimes or
conduct in the care of the goods and safety of the passengers (Art 47-) merchandiseE having failed Cuasi crimes
(?) Bamages to 0rd persons for tort and Cuasi6delict committed by the captain, he also gave to exercise for but he cannot
except collision with another vessel (Art 57@, ivil ode) his money its safe6 be excused
(4) Bamages in case of collision due to the fault, negligence, or want of s9ill of worth P?4@ to 9eeping the from liability
the captain, sailing mate, or any other member of the complement (Art 75>) master pil diligence for the
and reCuired by damage and
A!& 2A1! ;&+B$RA1 B1R/& +A!! /1&! supercargo the nature of harm which, in
!tandard il !tandard il 1he shipowner, 1he primary mportant to !olano for the obligation conseCuence
v. astelo delivered in the person of  liability is remember delivery to his assumed by of those acts,
petroleum to be the captain, has placed upon that the shop. "ut his them and by may be
conveyed by complete and the person shipowner money the suffered by
the charterer exclusive who has actual ordinarily has disappeared in circumstance the third
humbuCue control of the control over vastly more transit. of the time parties who
(which crew and of the the conduct of  capital and place, contracted
executed a navigation of the voyage embar9ed they are liable with the
lease the ship, as well and who has upon a for its loss or captain, in his
agreement w$ as of the most capital voyage than misplacement. double
shipowner disposition of embar9ed in has any 1he shipowner capacity of
astelo). 1he the cargo at the the venture, individual is also held agent and
officers and end of the namely, the shipper of liable. subordinate of 

?  of ,- 
 the shipowner latterDs failure be civilly liable  usage and
himself. to pay for the for the acts of understanding
%anila %$+ onsuelo, "oth the 1o admit the Birect goods. the captain of the
!teamship v. laden with shipowners of defense of due responsibility  Admiral +ine and for the business the
 Abdulhaman cargoes and colliding diligence in of the counters that obligations agent only is
passengers 6 vessels are the selection shipowner is it cannot be contracted by heldE or (0)
among were solidarily liable and vigilance recogni8ed in held liable the latter unless the
 Abdulhaman, to of the officers  Art. >7 since the to  repair, special
his wife and  Abdulhaman. and crew as where the contract of eCuip, circumstances
9ids 6 collided
1he exempting the captain shall agency with and provision of the case
with %$! shipowners shipowner be civilly respect to the vessel , show that only
"owline Fnot and ship from any liable to the "ar9 provided the the agent was
resulting to agents are liability for ship agent, %onongahela creditor proves intended to be
the death of civilly liable for their faults, and the ship had already that the bound and the
his 9ids and the captainDs would render agent is the ceased. amount seller 9new it
loss of acts (ode of nugatory the one liable to claimed was or was
personal ommerce, solidary 0rd persons. invested chargeable
properties.  Art. 47>) and liability thereinJ (Art. with
for the established by 47> ode of 9nowledge of
indemnities  Art. 75- of the ommerce). it.
due the third ode of
persons (Art. ommerce for No!e: &ven though the agent may not be the owner of the vessel, he is liable to the
47-). 1his the greater shippers and owners of the cargo transported by it, for losses and damages
direct liability protection of occasioned to such cargo without pre#udice to his right against the shipowners, to the
has been in#ured extent of the vesselDs value, its eCuipment, and the freight.
declared to parties.
exist, not only 5#6 Te (oc!rine o0 li/i!e( lia#ili!$
in case of  Article 47-. 1he agent shall also be civilly liable for the indemnities in favor of third
breached persons which arise from the conduct of the captain in the care of the goods which
contracts, but the vessel carriedE but he may exempt himself therefrom by abandoning the vessel
also in cases with all her eCuipments and the freight he may have earned during the voyage.
of tortious No!es: +imited liability is the evidence of maritime lawDs real and hypothecary nature
negligence. which distinguishes it from the civil law and mercantile law in general.
ing Fee ing Fee sold 1he bills were hen the nstances when limited liability is not applicable:
ompradoring and delivered presented agents buy in . /o abandonment of the vessel is made. 1he most fundamental effect of
o. v. "ar9 to "ar9 goods when Admiral their own abandonment is the cessation of the ownerDs responsibility (Gangco v
 I%onongahelaJ  thru bills +ine was still names, but +aserna)
which were the agent it really for the 5. !hipowner is at fault (%la !teamship v Abdulhaman)
made out can be held account of 0. or9menDs ompensation Act (Abueg v !an Biego)
against "ar9Ds liable for the their principal, ?. +iabilities for repairs of and provisioning the vessel effected before the loss
agent, Admiral expenses its the seller has of the vessel (ovDt v nsular %aritime)
+ine. ing principal an option to 4. essel is insured (hua Ge9 ;ong v A)
Fee now incurred loo9 to either
see9s to during the for payment, 0 cases where the vesselDs loss extinguishes the shipownerDs liability:
recover a sum lifetime of the unless () he . +iabilities arising from the captainDs conduct in the care of the goods and
of money agency since trusted the safety of the passengers, and liabilities arising from the captainDs negligent
from Admiral Ithe owner of agent or illicit acts, Art 47-
+ine on a vessel and exclusivelyE or 5. +iability for the wages of the captain = crew and for advances made by the
account of the the agent shall  (5) by the shipagent of the vessel is lost by shipwrec9 or capture, Art >?0

  of ,- 
 0. +iability for collision, Art 70- !an Biego owner of the favor of the has no room in
motor ships widows were the application of
A!& 2A1! ;&+B$RA1 B1R/& +A!! which were granted since it is the or9menDs
/1&! caught by a a liability created ompensation Act
%anila %$+ onsuelo, %$+ onsueloDs 1he right of typhoon, were by a statute to which see9s to
!teamship v. laden with owner +im ;ong abandonment of sun9 and totally compensate improve, and
 Abdulhaman, cargoes and 1o is not exempt vessels, as a legal lost. As a result, employees and aims at the
supra  passengers 6 from liability to limitation of a its machinists laborers in cases amelioration of
among were  Abdulhaman shipownerDs and captain of in#ury received the condition of
 Abdulhaman, his despite total loss liability does not perished. 1heir by or inflicted laborers and
wife and 9ids 6 of his sun9 vessel apply to cases widows filed suit upon them, while employees.
collided with %$! because both his where the in#ury for compensation engaged in the
"owline Fnot shipDs master = or the average is provided for in performance of
resulting to the engineer were due to the or9menDs their wor9 or
death of his 9ids not duly licensed shipownerDs fault. ompensation employment, or
and loss of as such. "y  Act. wner the heirs and
personal operating with an invo9ed limited dependents and
properties. unlicensed liability. laborers and
master, +im ;ong employees in the
1o deliberately event of death
increased the ris9  caused by their
to which the employment.
passengers and  Aboiti8 % Aboiti8 san9 +imited liability 1he rights of a
shippers of cargo !hipping v. on a voyage applies in favor vessel owner
aboard the vessel en. from ;F to the of Aboiti8. 1he under the +imited
would be  Accident 2ire Phils. As a result, real and +iability Rule are
sub#ected. = +ife en. Accident as hypothecary a9in to those of
 Gangco v. !! /egros  Gangco may not f the shipowner  Assurance subrogee of nature of the rights of
+aserna owned by be held liable in or agent may be orp several cargo maritime law shareholders to
 Gangco left for damages for the held civilly liable consignees means that the limited liability
%anila despite its conseCuent at all for in#ury to whose respective liability of a under our
captain being death of its or death of cargo san9 with carrier in corporation law.
advised that a passengers due passengers the vessel see9s connection with "oth are
typhoon signal to the total loss arising from to recover. losses related to privileges granted
no. 5 was up. of his vessel as a negligence of the maritime by statute. And
1he boat was result of captain in cases contracts is while not
also overloaded negligence of its of collisions or confined to the absolute, cannot
so against the captain. Art 47- shipwrec9s, his vessel, which is be swept aside
bad weather, the accords a liability is merely hypothecated for unless the most
captainDs attempt shipowner or co6extensive with such obligations compelling of
to return to the agent the right of  the interest in the or which stands reasons warrant
port was futile. abandonment vessel such that a as a guaranty for so.
1he boat san9 and so his liability total loss thereof their settlement.
resulting to dead is confined to results in its
passengers that which he is extinction. 5c6 S"eci0ic ri)!s an( "rero)a!i'es
among which entitled to
were the heirs of  abandon.  Article 4-4. o6owners of vessels shall have the right of repurchase and redemption
+aserna. in sales made to strangers, but they may exercise the same only within the nine days
 Abueg v. !an Biego is the ompensation in +imited liability

  of ,- 
following the inscription of the sale in the registry, and by depositing the price at the
same time.
 Article 430 . 1he owners of a vessel shall have preference in her charter to other
persons, offering eCual conditions and price. f two or more of the former should
claim said right the one having greater interest shall be preferred, and should they
have an eCual interest it shall be decided by lot.
 Article 43?. 1he co6owners shall elect the manager who is to represent them in the
capacity of agent.
1he appointment of director or agent shall be revocable at the will of the members.
 Article 43> . 1he agent may discharge the duties of captain of the vessel, sub#ect, in
every case, to the provisions contained in Article >@3.
f two or more co6owners reCuest the position of captain, the disagreement shall be
decided by a vote of the membersE and if the vote should result in a tie, the position
shall be given to the part owner having the larger interest in the vessel.
f the interest of the petitioners should be the same, and there should be a tie, the
matter shall be decided by lot.
 Article >@. !hould there be any profits, the co6owners may demand of the managing
agent the amount due them, by means of an executory action without further
reCuisites than the ac9nowledgment of the signatures of the instrument approving
the account.
4. Ca"!ains an( *as!er
No!es:
aptain O governs vessels that navigate the high seas or ships of large dimensions
and importance, although they be engaged in the coastwise trade.
%aster O commands smaller ships engaged exclusively in the coastwise trade.
2or the purposes of maritime commerce, ZcaptainD and ZmasterD have the same
meaningE both being the chiefs or commanders of ships.
5a6 uali0ica!ions an( licensin)
RA 4-0 (An Act reating a Philippine oast uard, Prescribing ts Powers and
2unctions, Appropriating the /ecessary 2unds 1herefor, and for ther Purposes),
!ection 0: !pecific 2unctions.
1he Philippine oast uard shall perform the following functions:
(a) 1o prevent and suppress illegal entry, smuggling, other customs frauds and
violations of other maritime laws that may be committed within the waters
sub#ect to the #urisdiction of the Republic of the Philippines, and for the
purpose surveillance by the Philippine oast uard may be made on vessels
entering and$or leaving the Philippine territoryE
(b) 1o assist in the suppression of fishing by means of dynamite, explosives or
toxic substances or other methods as may be declared destructive by proper
authoritiesE
(c) 1o promulgate and enforce rules for lights, signals, speed, steering, sailing,
passing, anchorage, movement and towlines of vessels and lights and
signals on bridgesE
(d) 1o approve plans for the construction, repair, or alteration of vesselsE
approve materials, eCuipment and appliances of vesselsE approved the
classification of vesselsE inspect vessels and their eCuipment and appliancesE
register all types of motori8ed watercraft plying in Philippine watersE issue
certificates of inspection and of permits indicating the approval of vessels for
operationE issue certificates of Philippine registry of vesselsE administer load
line reCuirementsE promulgate and enforce other provisions for the safety of
life and property on vesselsE and determine the numbering of
undocumented vessels: Provided , 1hat certification and approval of any
plans, eCuipment and any vessel by internationally 9nown classification
societies which are recogni8ed by the Philippine overnment shall be
deemed to have complied with this sectionE
(e) 1o issue licenses and cer!i0ica!es  to officers, pilots, ma#or and minor
patrons and seamen, as well as suspend and revo9e such licenses and
certificatesE
(f) 1o investigate marine casualties and disasters including those arising from
marine protests filed with the "ureau of ustoms relative to the liability of
shipowners and officersE
(g) 1o enforce laws, rules and regulations governing manning, citi8enship and
mustering and drilling of crews reCuirements, control of logboo9s, shipment,
discharge, protection, and welfare merchant seamenE
(h) 1o enforce laws reCuiring the performance of duties of shipowners and
officers after accidentsE
(i) 1o prescribe and enforce regulations for outfitting and operation of
motorboats and the licensing of motorboat operatorsE
(#) 1o regulate regattas and marine paradesE
(9) 1o render aid to distressed persons or vessels on the high seas and on
waters sub#ect to the #urisdiction of the Philippines, and, in this connection,
the Philippine oast uard may perform any and all acts necessary to rescue
and aid personsE furnish clothing, food, lodging, medicine and other
necessary supplies and services to persons succoredE protect, save, and ta9e
charge of all property saved from marine disasters until such property is
delivered to persons authori8ed to receive it or is otherwise disposed of in
accordance with law or applicable regulationsE and collect and ta9e charge
of bodies of those who may perish in such disastersE
(l) 1o develop, establish, maintain, and operate aids to maritime navigation. n
the performance of these functions, the Philippine oast uard is authori8ed
to destroy or tow in port sun9en of floating dangers to navigationE
(m) 1o supervise nautical schools with reference to activities relative to
navigation, seamanship, marine engineering and other allied matters, in
coordination with the Bepartment of &ducationE
(n) 1o perform functions pertaining to maritime communications which are not
specifically delegated to some other office or departmentE and
(o) 1o assist, within its capabilities and upon reCuest of the appropriate
authorities, other overnment agencies in the performance of their
functions, within the waters sub#ect to the #urisdiction of the Philippines,
  of ,- 
 relating to matters and activities not specifically mentioned in this
section: Provided , 1hat in the exercise of these functions, personnel of the
Philippine oast uard shall be deemed to be acting as agents of the
particular departments, bureau, office, agency or instrumentality charged
with the enforcement and administration of the particular law. %embers of
the Philippine oast uard are peace officers for all purposes of this Act and
shall be, and shall act, as law enforcement agents of the "ureau of ustoms,
and the "ureau of mmigration, the "ureau of nternal Revenue, the
2isheries ommission, and such other departments, bureaus or offices in the
enforcement of pertinent laws, rules and regulations.
 Article >@3. aptains, masters or patrons of vessels must be 2ilipinos, have legal
capacity to contract in accordance with this code, and prove the s9ill, capacity, and
Cualifications necessary to command and direct the vessel, as established by marine
or navigation laws, ordinances, or regulations, and must not be disCualified according
to the same for the discharge of the duties of the position.  
f the owner of a vessel desires to be the captain thereof and does not have the legal
Cualifications therefor, he shall limit himself to the financial administration of the
vessel, and shall intrust her navigation to a person possessing the Cualifications
reCuired by said ordinances and regulations.
5#6 Po2ers an( Du!ies
 Article >@. 1he following powers are inherent in the position of captain or master of
a vessel:
. 1o appoint or ma9e contracts with the crew in the absence of the agent and
propose said crew, should said agent be presentE but the agent shall not be
permitted to employ any member against the captainMs express refusal.
5. 1o command the crew and direct the vessel to the port of its destination, in
accordance with the instructions he may have received from the agent.
0. 1o impose, in accordance with the agreements and the laws and regulations
of the merchants marine, on board the vessel, correctional punishment upon
those who do not comply with his orders or who conduct themselves against
discipline, holding a preliminary investigation on the crimes committed on
board the vessel on the high seas, which shall be turned over to the
authorities, who are to ta9e cogni8ance thereof, at the first port touched.
?. 1o ma9e contracts for the charter of the vessel in the absence of the agent
or of her consignee, acting in accordance with the instructions received and
protecting the interests of the owner most carefully.
4. 1o adopt all the measures which may be necessary to 9eep the vessel well
supplied and eCuipped, purchasing for the purpose all that may be
necessary, provided there is no time to reCuest instructions of the agent.
>. 1o ma9e, in similar urgent cases and on a voyage, the repairs to the hull
and engines of the vessel and to her rigging and eCuipment which are
absolutely necessary in order for her to be able to continue and conclude
her voyageE but if she should arrive at a point where there is a consignee of
the vessel, he shall act in concurrence with the latter.
No!e: 2irst 0 powers cannot be renounced as they relate to public order and are
vested in the captain as a Zdelegation of public authorityD.
 Article >. n order to comply with the obligations mentioned in the foregoing
article, the captain, when he has no funds and does not expect to receive any from
the agent, shall procure the same in the successive order stated below:
. "y reCuesting said funds of the consignees or correspondents of a vessel.
5. "y applying to the consignees of the cargo or to the persons interested
therein.
0. "y drawing on the agent.
?. "y borrowing the amount reCuired by means of a bottomry bond.
4. "y selling a sufficient amount of the cargo to cover the amount absolutely
necessary to repair the vessel, and to eCuip her to pursue the voyage.
n these two last cases he must apply to the #udicial authority of the port, if in the
Philippines, and to the consul of the Republic of t he Philippines if in a foreign country,
and where there is none, to the local authority, proceeding in accordance with the
provisions of Article 470, and with the provisions of the law of civil procedure.
Article >5. 1he following obligations shall be inherent in the office of captain:
. 1o have on board before starting on a voyage a detailed inventory of the
hull, engines, rigging, spare6masts, tac9le, and other eCuipment of the
vesselE the royal or the navigation certificateE the roll of the persons who
ma9e up the crew of the vessel, and the contracts entered into with themE
the lists of passengersE the bill of healthE the certificate of the registry
proving the ownership of the vessel and all the obligations which encumber
the same up to that dateE the charter parties or authenticated copies
thereofE the invoices or manifests of the cargo, and the memorandum of the
visit or inspection by experts, should it have been made at the port of
departure.
5. 1o have a copy of this code on board.
0. 1o have three folioed and stamped boo9s, placing at the beginning of each
one a memorandum of the number of folios it contains, signed by the
maritime authority, and in his absence by the competent authority. n the
first boo9, which shall be called Nlog boo9,N he shall enter day by day the
condition of the atmosphere, the prevailing winds, the courses ta9en, the
rigging carried, the power of the engines used in navigation, the distances
covered, the maneuvers executed, and other incidents of navigationE he
shall also enter the damage suffered by the vessel in her hull, engines,
rigging, and tac9le, no matter what its cause may be, as well as the
impairment and damage suffered by cargo, and the effect and importance of 
the #ettison, should there be anyE and in cases of serious decisions which
reCuire the advice or a meeting of the officers of the vessel, or even of the
crew and passengers, he shall record the decisions adopted. 2or the
information indicated he shall ma9e use of the binnacle boo9 and of the
steam of engine boo9 9ept by the engineer. n the second boo9 called the
Naccounting boo9,N he shall record all the amounts collected and paid for the
account of the vessel, entering specifically article by article, the source of
the collection and the amounts spent for provisions, repairs, acCuisitions of
eCuipment or goods, fuel, food, outfits, wages, and other expenses of
whatever nature they may be. ;e shall furthermore enter therein a list of all
the members of the crew, stating their domiciles, their wages and salaries,
and the amounts they may have received on account, directly or by delivery
to their families. n the third boo9, called Nfreight boo9,N he shall record the
-  of ,- 
 loading and discharge of all the goods, stating their mar9s and pac9ages,
names of the shippers and of the consignees, ports of loading and
unloading, and the freightage they give. n this same boo9 he shall record
the names and places of sailing of the passengers, the number of pac9ages
in their baggage, and the price of passage.
?. "efore receiving cargo, to ma9e with the officers of the crew and two
experts, if reCuired by the shippers and passengers, an examination of the
vessel, in order to ascertain whether it is water6tight, with the rigging and
engines in good condition, and with the eCuipment reCuired for good
navigation, preserving under his responsibility a certificate of the
memorandum of his inspection, signed by all those who may have ta9en
part therein. 1he experts shall be appointed, one by the captain of the
vessel and another by those who reCuest its examination, and in case of
disagreement a third shall be appointed by the marine authority of the port
or by the authority, exercising his functions.
4. 1o remain constantly on board the vessel with the crew while the cargo is
being ta9en on board and to carefully watch the stowage thereofE not to
consent to the loading of any merchandise or matter of a dangerous
character, such as inflammable or explosive substances, without the
precautions which are recommended for their pac9ing, handling and
isolationE not to permit the carriage on dec9 of any cargo which by reason of  4.
its arrangement, volume, or weight ma9es the wor9 of the sailors difficult,
and which might endanger the safety of the vesselE and if, on account of the
nature of the merchandise, the special character of the shipment, and
principally the favorable season in which it is underta9en, merchandise may
be carried on dec9, he must hear the opinion of the officers of t he vessel
and have the consent of the shippers and of the ship agent.
>. 1o demand a pilot at the expense of the vessel whenever reCuired by the
navigation, and principally when he has to enter a port, canal, or river, or
has to ta9e a roadstead or anchoring place with which neither he nor the
officers and crew are acCuainted.
-. 1o be on dec9 on reaching land and to ta9e command on entering and
leaving ports, canals, roadsteads, and rivers, unless there is a pilot on board
discharging his duties. ;e shall not spend the night away f rom the vessel
except for serious causes or by reason of official business.
7. 1o present himself, when ma9ing a port in distress, to the maritime
authority if in the Philippines and to the consul of the Republic of the
Philippines if in a foreign country, before twenty6four hours have elapsed,
and to ma9e a statement of the name registry, and port of departure of the
vessel, of its cargo, and the cause of arrival which declaration shall be
visaed by the authority or the consul, if after examining the same it is found
to be acceptable, giving the captain the proper certificate proving his arrival
in distress and the reasons therefor. n the absence of the maritime
authority or of the consul, the declaration must be made before the local
authority.
3. 1o ta9e the necessary steps before the competent authority in order to
record in the certificate of the vessel in the registry of vessels the obligations
which he may contract in accordance with Article 470.
@. 1o place under good care and custody all the papers and belongings of any
members of the crew who might die on the vessel, drawing up a detailed
inventory, in the presence of passengers, or, in their absence, of members
of the crew as witnesses.
. 1o conduct himself according to the rules and precepts contained in the
instructions of the shipagent, being liable for all that w hich he may do in
violation thereof.
5. 1o inform the ship agent from the port at which the vessel arrives, of the
reason of his arrival, ta9ing advantage of the semaphore, telegraph, mail,
etc., as the case may beE to notify him of the cargo he may have received,
stating the names and domiciles of the shippers, freightage earned, and
amounts borrowed on bottomry loanE to advise him of his departure, and of
any operation and date which may be of interest to him.
0. 1o observe the rules with respect to situation, lights and maneuvers in order
to avoid collisions.
?. 1o remain on board, in case the vessel is in danger, until all hope to save it
is lost, and before abandoning it, to hear the officers of the crew, abiding by
the decision of the ma#orityE and if the boats are to be ta9en to, he shall
ta9e with him, before anything else, the boo9s and papers, and then the
articles of most value, being obliged to prove, in case of the loss of the
boo9s and papers, that he did all he could to save them.
n case of wrec9, to ma9e the proper protest in due form at the first port of
arrival, before the competent authority or the Philippine consul, within
twenty6four hours, specifying therein all the incidents of the wrec9, in
accordance with subdivision 7 of this article.
>. 1o comply with the obligations imposed by the laws and regulations on
navigation, customs, health, and others.
No!e: 0 boo9s to be 9ept by the captain: log boo9, accounting boo9 and freight boo9 
 Article >55. f while on a voyage the captain should learn of the appearance of
privateers or men of war against his f lag, he shall be obliged to ma9e the nearest
neutral port, inform his agent or shippers, and await an occasion to sail under
convoy, or until the danger is over or he has received express orders from the ship
agent or the shippers.
 Article >5?. A captain whose vessel has gone through a hurricane or who believes
that the cargo has suffered damages or averages, shall ma9e a protest thereon
before the competent authority at the first port he touches, within 5? hours following
his arrival and shall ratify it within the same period when he arrives at his destination,
immediately proceeding with the proof of the facts, and he may not open the hatches
until after this has been done.
1he captain shall proceed in the same manner, if, the vessel having been wrec9edE
he is saved alone or with part of his crew, in which case he shall appear before the
nearest authority, and ma9e a sworn statement of facts.
1he authority or the consul shall verify the said facts receiving sworn statements of
the members of the crew and passengers who may have been savedE and ta9ing
such other steps as may assist in arriving at the facts he shall ma9e a statement of
the result of the proceedings in the log boo9 and in that of the sailing mate, and shall
deliver to the captain the original records of the proceedings, stamped and folioed,
, of ,- 
with a memorandum of the folios, which he must rubricate, in order that it may be  Article >4. ithout the consent of the agent, the captain cannot have himself
presented to the #udge or court of the port of destination. substituted by another personE and should he do so, besides being liable for all the
1he statement of the captain shall be accepted if it is in accordance with those of the acts of the substitute and bound to the indemnities mentioned in the foregoing
crew and passengersE if they disagree, the latter shall be accepted, always saving article, the substitute as well as the captain may be discharged by the agent.
proof to the contrary.
No!e: 1he prohibition against the captainDs substitution without the agentDs consent
 Article >54. 1he captain, under his personal responsibility, as soon as he arrives at is essentially personal due to the confidence given to the captain arising from the fact
the port of destination, should get the necessary permission from the health and that he possesses the reCuired technical ability and that he is the man worthy of
customs officers, and perform the other formalities reCuired by the regulations of the shipownerDs trust.
administration, delivering the cargo without any defalcation, to the consignee, and in
a proper case, the vessel, rigging and freightage to the ship agent.  Article >-. 1he captain cannot contract loans on respondentia, and should he do so
f by reason of the absence of the consignee or on account of the nonappearance of the contracts shall be void.
a legal holder of the bills of lading, the captain should not 9now to whom he is to /either can he borrow money on bottomry for his own transactions, except on the
legally ma9e the delivery of the cargo, he shall place it at the disposal of the proper portion of the vessel he owns, provided no money has been previously borrowed on
 #udge or court or authority, in order that he may determine what is proper with the whole vessel, and provided there does not exist any other 9ind of lien or
regards to its deposit, preservation and custody. obligation thereon. hen he is permitted to do so, he must necessarily state what
interest he has in the vessel.
A!& 2A1! ;&+B$RA1 B1R/& +A!! /1&! n case of violation of this article the principal, interest, and costs shall be charged to
nter 1ayong is apt. 1ayong  A shipDs captain aptainDs 0 the private account of the captain, and the agent may furthermore have the right to
rient v. nter rientDs had reasonable must be distinct roles: discharge him.
/+R captain which grounds to accorded a () general
it terminated believe that the reasonable agent of the  Article >5. A captain who borrows money on bottomry, or who pledges or sells
due to his safety of the measure of shipownerE (5) merchandise or provisions in other cases and without the formalities prescribed in
delay in vessel and the discretionary commander and this code, shall be liable for the principle, interest, and costs, and shall indemnify for
sailing to crew under his authority to technical the damages he may cause.
!outh Africa command decide what the director of the 1he captain who commits fraud in his accounts shall reimburse the amount
to load coal. reCuired him to safety of the vessel most defrauded, and shall be sub#ect to the provisions contained in the penal code.
1he delay was wait for the ship and of its important roleQE
due to delivery of the crew and cargo and (0)  Article 470. f while on a voyage the captain should find it necessary to contract one
1ayongDs supplies needed specifically representative or more of the obligations mentioned in subdivisions 7 and 3 of Article 47@, he shall
decision not for the repair of  reCuires on a of the country apply to the #udge or court if he is in Philippine territory, and otherwise to the consul
to embar9 for the ship. stipulated under whose of the Republic of the Philippines, should there be one, and, in his absence, to the
!outh Africa ocean voyage. flag he  #udge or court or proper local authority, presenting the certificate of the registration
until the navigates. sheet treated of in Article >5 and the instruments proving the obligation contracted.
vessel he 1he #udge or court, the consul, or the local authority, as the case may be, in view of
commands the result of the proceedings instituted, shall ma9e a temporary memorandum of
was repaired. their result in the certificate, in order that it may be recorded in the registry when the
vessel returns to the port of its registry, or so that it can be admitted as a legal and
5c6 Proi#i!e( ac!s an( !ransac!ions preferred obligation in case of sale before its return, by reason of the sale of the
vessel on account of a declaration of unseaworthiness.
 Article >0. A captain who navigates for freight in common or on shares cannot ma9e 1he omission of this formality shall ma9e the captain personally liable for the credits
any transaction for his exclusive account, and should he do so the profit shall belong pre#udiced on his account.
to the other persons in interest, and the losses shall be for his own exclusive account.
. O!er O00icers an( Cre2
 Article >? . A captain who, having made an agreement to ma9e a voyage, fails to 5a6 Con!rac!s an( 0or/ali!ies
perform his underta9ing, without being prevented by fortuitous accident or force
ma#eure, shall indemnify for all the losses which he may cause, without pre#udice to  Article >0?. 1he captain may ma9e up the crew of his vessel with such number of
the criminal penalties which may be proper. men as he may consider proper, and in the absence of 2ilipino sailors, he may ta9e
on foreigners residing in the country, the number thereof not to exceed one6fifth of

4  of ,- 
the crew. f in foreign ports the captain should not find a sufficient number of 2ilipino
sailors, he may complete the crew with foreigners, with the consent of the consul or
marine authorities.
1he agreement which the captain may ma9e with the members of the crew and
others who go to ma9eup the complement of the vessel, to which reference is made
in Article >5, must be reduced to writing in the account boo9, without the
intervention of a notary public or cler9 of court (NescribanoN), signed by the parties
thereto and visaed by the marine authority if they be executed in Philippine territory
or by the consuls or consular agents of the Republic of the Philippines if executed
abroad, stating therein all the obligations which each one contracts and all the rights
he acCuires said authorities ta9ing care that these obligations and rights are recorded
in a clear and definite manner which give no room for doubts or claims.
1he captain shall ta9e care to read to them the articles of this ode which concern
them, stating in said document that they were read.
f the boo9 contains the reCuisites prescribed in Article >5, and there should not
appear any signs of alterations in its entries, it shall be admitted as evidence in  
Cuestions which may arise between the captain and the crew with respect to the
agreements contained therein and the amounts paid on account of the same.
&very member of the crew may demand of the captain a copy, signed by the latter,
of the agreement and of the liCuidation of his wages, as they appear in the boo9.
5#6 Du!ies an( lia#ili!ies  
 Article >04. A seaman who has been contracted to serve on a vessel cannot rescind
his contract nor fail to comply therewith except by reason of a legitimate impediment
which may have occurred.
/either can he pass from the service of one vessel to another without obtaining the
written permission of the captain of the vessel on which he may be.
f, without obtaining said permission, the seaman who has signed for one vessel
should sign for another one, the second contract shall be void, and the captain may
choose between forcing him to fulfill the service to which he first bound himself or
loo9 for a person to substitute him at his expense.
2urthermore, he shall lose the wages earned on his first contract to the benefit of the
vessel for which he may have signed.
 A captain who, 9nowing that a seaman is in the service of another vessel, should
have made a new agreement with him, without having reCuested the permission
referred to in the foregoing paragraphs, shall be personally liable to the captain of
the vessel to which the seaman first belonged for that part of the indemnity, referred
to in the third paragraph of this article, which the seaman may not be able to pay.
5c6 Ri)!s
 Article >0>. !hould a fixed period for which a seaman has signed not be stated, he
may not be discharged until the end of the return voyage to the port where he
enrolled.
 Article >0-. /either can the captain discharge a seaman during the time of his
contract except for sufficient cause, the following being considered as such:
. 1he perpetration of a crime which disturbs order on the vessel.
5. Repeated offenses of insubordination, against discipline, or against the
fulfillment of the service.
0. Repeated incapacity or negligence in the fulfillment of the service to be
rendered.
?. ;abitual drun9enness.
4. Any occurrence which incapacitates the seaman to carry out the wor9 under
his charge, with the exception of the provisions contained in article >??.
>. Besertion.
1he captain may, however, before setting out on a voyage and without giving any
reason whatsoever, refuse to permit a seaman he may have engaged from going on
board and may leave him on land, in which case he will be obliged to pay him his
wages as if he had rendered services.
1his indemnity shall be paid from the funds of the vessel if the captain should have
acted for reasons of prudence and in the interest of the safety and good service of
the former. !hould this not be the case, it shall be paid by the captain personally.
After the vessel has sailed, and during the voyage and until the conclusion thereof,
the captain can not abandon any member of his crew on land or on the sea, unless,
by reason of being guilty of some crime, his imprisonment and delivery to the
competent authority is proper in the first port touched, which will be obligatory on
the captain.
Article >07. f, the crew having been engaged, the voyage is revo9ed by the will of
the agent or of the charterers before or after the vessel has put to sea or if the vessel
is in the same manner given a different destination than that fixed in the agreement
with the crew, the latter shall be indemnified because of the rescission of the contract
according to the case, vi8:
. f the revocation of the voyage should be decided before the departure of
the vessel from the port, each seaman engaged shall be given one monthMs
salary, besides what may be due him in accordance with his contract, for the
services rendered to the vessel up to the date of the revocation.
5. f the agreement should have been for a fixed amount for the whole voyage,
there shall be graduated what may be due for said month and days,
calculating the same in proportion to the estimated duration of the voyage,
in the #udgment of experts, in the manner established in the law of civil
procedureE and if the proposed voyage should be of such short duration that
it is calculated at one month more or less, the indemnity shall be fixed for
fifteen days, discounting in all cases the sums advanced.
0. f the revocation should ta9e place after the vessel has put to sea, the
sailors engaged for a fixed amount for the voyage shall receive the salary
which may have been offered them in full as if the voyage had terminated,
and those engaged by the month shall receive the amount corresponding to
the time they might have been on board and to the time they may reCuire to
arrive at the port of destination, the captain being obliged, furthermore, to
pay said sailors the passage to the said port or to the port of sailing of the
vessel, as may be convenient for them.
?. f the agent or the charterers of the vessel should give said vessel a
destination other than that fixed in the agreement, and the members of the
crew should not agree thereto, they shall be given by way of indemnity half
the amount fixed in case no. , besides what may be owed them for the part
:  of ,- 
 of the monthly wages corresponding to the days which have elapsed from
the date of their agreements.  
f they accept the change, and the voyage, on account of the greater distance or for
other reasons, should give rise to an increase of wages, the latter shall be privately
regulated, or through amicable arbitrators in case of disagreement. &ven though the
voyage may be to a nearer point, this shall not give rise to a reduction in the wages
agreed upon.
f the revocation or change of the voyage should originate from the shippers or
charterers, the agent shall have a right to demand of them the indemnity which is
 #ustly due.
 Article >03. f the revocation of the voyage should arise from a #ust cause
independent of the will of the agent or charterers, and the vessel should not have left
the port, the members of the crew shall not have any other right than to receive the  
wages earned up to the day on which the revocation too9 place.
 Article >?@. 1he following shall be #ust causes for the revocation of the voyage:
. A declaration of war or interdiction of commerce with the power to whose
territory the vessel was bound.
5. 1he bloc9ade of the port of destination or the brea9ing out of an epidemic
after the agreement.
0. 1he prohibition to receive in said port the goods which ma9e up the cargo of   Article >?4 . f a seaman should die during the voyage his heir shall be given the
the vessel.
?. 1he detention or embargo of the same by order of the government, or for
any other reason independent of the will of the agent.
4. 1he inability of the vessel to navigate.
 Article >?. f, after a voyage has been begun, any of the first three causes
mentioned in the foregoing article should occur, the sailors shall be paid at the port
the captain may deem it advisable to ma9e for the benefit of the vessel and cargo,  
according to the time they may have served thereonE but if the vessel is to continue
the voyage, the captain and the crew may mutually demand the enforcement of the
contract.
n case of the occurrence of the fourth cause, the crew shall continue to be paid half
wages, if the agreement is by month but if the detention should exceed three
months, the engagement shall be rescinded and the crew shall be paid what they
should have earned, according to the contract, if the voyage had been made. And if
the agreement had been made for a fixed sum for the voyage, the contract must be
complied within the terms agreed upon.
n the fifth case, the crew shall not have any other right than be entitled to recover
the wages earnedE but if the disability of the vessel should have been caused by the
negligence or lac9 of s9ill of the captain, engineer, or sailing mate, they shall  
indemnify the crew for the loss suffered, always reserving the criminal liability which
may be proper.
 
 Article >?5. f the crew has been engaged to wor9 on shares they shall not be
entitled, by reason of the revocation, delay, or greater extension of the voyage, to
anything but the proportionate part of the indemnity paid into the common funds of  
the vessel by the persons liable for said occurrences.
Article >?0 . f the vessel and her freight should be totally lost, by reason of capture
or wrec9, all rights of the crew to demand any wages whatsoever shall be
extinguished, as well as that of the agent for the recovery of the advances made.
f a portion of the vessel or freight should be saved, or part of either, the crew
engaged on wages, including the captain, shall retain their rights on the salvage, so
far as they go, on the remainder of the vessel as well as value of the freightage or
the cargo savedE but sailors who are engaged on shares shall not have any right
whatsoever to the salvage of the hull, but only on the portion of the freightage
saved. f they should have wor9ed to collect the remainder of the ship6wrec9ed
vessel, they shall be given an award in proportion to the efforts made and to the ris9s
encountered in order to accomplish the salvage.
Article >??. A seaman who falls sic9 shall not lose his right t o wages during the
voyage, unless the sic9ness is the result of his own fault. At any rate, the costs of the
attendance and cure shall be defrayed from the common funds, in the form of a loan.
f the sic9ness should be caused by an in#ury received in the service or defense of the
vessel the seaman shall be attended and cured from the common funds, there being
deducted before anything else from the proceeds of the freight, the cost of the
attendance and cure.
wages earned and not received, according to his engagement and the reason for his
death, namely S
f he should have died a natural death and should have been engaged on wages
there shall be paid what may have been earned up to the date of his death.
f the engagement had been made for a fixed sum for the whole voyage there shall
be paid half the amount earned if the seaman died on the voyage out, and the whole
amount if he died on the return voyage.
And if the engagement had been made on shares and the death should have
occurred after the voyage was begun, the heirs shall be paid the entire portion due
the seamanE but should the latter have died before the departure of the vessel from
the port, the heirs shall not be entitled to claim anything.
f the death should have occurred in t he defense of the vessel, the seaman shall be
considered as living, and his heirs shall be paid, at the end of the voyage, the f ull
amount of wages or the full part of the profits due him as to the others of his grade.
1he seaman shall li9ewise be considered as present in the event of his capture when
defending the vessel, in order to en#oy the same benefits as the restE but should he
have been captured on account of carelessness or other accident not related to the
service, he shall only receive the wages due up to the day of his capture.
Article >?> . 1he vessel with her engines, rigging, eCuipment, and freights shall be
liable for the wages earned by the crew engaged per month or for the trip, the
liCuidation and payment ought to ta9e place between one voyage and the other.
After a new voyage has been underta9en, credits such as the former shall lose their
right of preference.
Article >?- . 1he officers and the crew of the vessel shall be exempted from all
obligations contracted, if they deem it proper, in the following cases:
>  of ,- 
 . f, before the beginning of the voyage, the captain attempts to change it, or
there occurs a naval war with the power to which the vessel was destined.
5. f a disease should brea9 out and be officially declared epidemic in the port
of destination.
0. f the vessel should change owner or captain.
>. Su"ercar)oes
 Article >?3 . !upercargoes shall discharge on board the vessel the administrative
duties which the agent or shippers may have assigned themE they shall 9eep an
account and record of their transactions in a boo9 which shall have the same
conditions and reCuisites as reCuired for the accounting boo9 of the captain, and shall
respect the latter in his duties as chief of the vessel.
1he powers and liabilities of the captain shall cease, when there is a supercargo, with
regard to that part of the administration legitimately conferred upon the latter, but
shall continue in force for all acts which are inseparable from his authority and office.
 Article >4@. All the provisions contained in the second section of title iii, boo9 ii, with
regard to Cualifications, manner of ma9ing contracts, and liabilities of factors shall be
applicable to supercargoes.
 Article >4. !upercargoes cannot, without special authori8ation or agreement, ma9e
any transaction for their own account during the voyage, with the exception of the
ventures which, in accordance with the custom of the port of destination, they are
permitted to do.
/either shall they be permitted to invest in the return trip more than the profits from
the ventures, unless there is a special authori8ation thereto from the principals.
No!e: !upercargo O an agent of the owner of goods shipped as cargo on a vessel,
who has charge of the cargo on board, sells the cargo to t he best advantage in the
foreign mar9ets, buys a cargo to be brought bac9 on the return voyage of the ship,
and comes home with it.
D. Acci(en!s an( Da/a)es in *ari!i/e Co//erce
,. A'era)es
5a6 Na!ure an( 3in(s
 Article 7@>. 2or the purposes of this code the following shall be considered averages:
. All extraordinary or accidental expenses which may be incurred during the
voyage in order to preserve the vessel, the cargo, or both.
5. Any damages or deteriorations which the vessel may suffer from the time it
puts to sea from the port of departure until it casts anchor in the port of
destination, and those suffered by the merchandise from the time they are
loaded in the port of shipment until they are unloaded in the port of their
consignment.
 Article 7@-. 1he petty and ordinary expenses incident to navigation, such as those of
pilotage of coasts and ports, those of lighterage and towage, anchorage, inspection,
health, Cuarantine, la8aretto, and other so6called port expenses, costs of barges and
unloading until the merchandise is placed on the wharf, and any other usual
expenses of navigation, shall be considered ordinary expenses to be defrayed by the
shipowner, unless there is an express agreement to the contrary.
 Article 7@7 . Averages shall be:
. !imple or particular.
5. eneral or gross.
No!es:
 Average constitutes of:
() expenses, which must be:
(a) extraordinary or accidental
(b) incurred during the voyage
(c) incurred in order to preserve the vessel, the cargo, or both
(5) damages or deteriorations, which must:
(a) have been suffered from the time the vessel puts to sea from the port of
departure until it casts anchor in the port of destination, or
(b) have been suffered by the merchandise from the time they are loaded in the
port of shipment until they are unloaded in the port of their consignment
&xpenses in Art 7@- are not considered average.
+aw of averages is not applicable when negligence of the captains of the colliding
vessel is the cause of the collision, and the cargoes are not #ettisoned to save some
of the cargoes and the vessel (/atDl BevDt v A).
5,6 Si/"le or Par!icular
5a6 De0ine(
 Article 7@3. !imple or particular averages shall be, as a general rule, all the expenses
and damages caused to the vessel or to her cargo which have not redounded to the
benefit and common profit of all the persons interested in the vessel and her cargo,
and especially the following:
. 1he damages suffered by the cargo from the time of its embar9ation until it
is unloaded, either on account of the nature of the goods or by reason of an
accident at sea or force ma#eure, and the expenses incurred to avoid and
repair the same.
5. 1he damages suffered by the vessel in her hull, rigging, arms, and
eCuipment, for the same causes and reasons, from the time she puts to sea
from the port of departure until she anchored in the port of destination.
0. 1he damages suffered by the merchandise loaded on dec9, except in
coastwise navigation, if the marine ordinances allow it.
?. 1he wages and victuals of the crew when the vessel should be detained or
embargoed by a legitimate order or force ma#eure, if the charter should
have been for a fixed sum for the voyage.
4. 1he necessary expenses on arrival at a port, in order to ma9e repairs or
secure provisions.
>. 1he lowest value of the goods sold by the captain in arrivals under stress for
the payment of provisions and in order to save the crew, or to cover any
other reCuirement of the vessel against which the proper amount shall be
charged.
-. 1he victuals and wages of the crew during the time the vessel is in
Cuarantine.
  of ,- 
 7. 1he damage suffered by the vessel or cargo by reason of an impact or
collision with another, if it were accidental and unavoidable. f the accident
should occur through the fault or negligence of the captain, the latter shall
be liable for all the damage caused.
3. Any damage suffered by the cargo through the faults, negligence, or
barratry of the captain or of the crew, without pre#udice to the right of the
owner to recover the corresponding indemnity from the captain, the vessel,
and the freight.
No!e: &numeration under Art 7@3 is not exclusive.
5#6 E00ec!s
 Article 7@. 1he owner of the goods which gave rise to the expense or suffered the
damage shall bear the simple or particular averages.
546 Gross or General
5a6 De0ine(
 Article 7. eneral or gross averages shall be, as a general rule, all the damages
and expenses which are deliberately caused in order to save the vessel, her cargo, or
both at the same time, from a real and 9nown ris9, and particularly the following:
. 1he goods or cash invested in the redemption of the vessel or cargo
captured by enemies, privateers, or pirates, and the provisions, wages, and
expenses of the vessel detained during the time the arrangement or
redemption is ta9ing place.
5. 1he goods #ettisoned to lighten the vessel, whether they belong to the
vessel, to the cargo, or to the crew, and the damage suffered through said
act by the goods 9ept.
0. 1he cables and masts which are cut or rendered useless, the anchors and
the chains which are abandoned in order to save the cargo, the vessel, or
both.
?. 1he expenses of removing or transferring a portion of the cargo in order to
lighten the vessel and place her in condition to enter a port or roadstead,
and the damage resulting therefrom to the goods removed or transferred.
4. 1he damage suffered by the goods of the cargo through the opening made
in the vessel in order to drain her and prevent her sin9ing.
>. 1he expenses caused through floating a vessel intentionally stranded for the
purpose of saving her.
-. 1he damage caused to the vessel which it is necessary to brea9 open,
scuttle, or smash in order to save the cargo.
7. 1he expenses of curing and maintaining the members of the crew who may
have been wounded or crippled in defending or saving the vessel.
3. 1he wages of any member of the crew detained as hostage by enemies,
privateers, or pirates, and the necessary expenses which he may incur in his
imprisonment, until he is returned to the vessel or to his domicile, should he
prefer it.
@. 1he wages and victuals of the crew of a vessel chartered by the month
during the time it should be embargoed or detained by force ma#eure or by
order of the overnment, or in order to repair the damage caused for the
common good.
. 1he loss suffered in the value of the goods sold at arrivals under stress in
order to repair the vessel because of gross average.
5. 1he expenses of the liCuidation of the average.
 Article 7-. f in lightening a vessel on account of a storm, in order to facilitate her
entry into a port or roadstead, part of her cargo should be transferred to lighters or
barges and be lost, the owner of said part shall be entitled to indemnity, as if the loss
has originated from a gross average, the amount thereof being distributed between
the entire vessel and cargo which caused the same.
f, on the contrary, the merchandise transferred should be saved and the vessel
should be lost, no liability can be demanded of the salvage.
 Article 77. f, as a necessary measure to extinguish a fire in a portE roadsteadE
cree9, or bay, it should be decided to sin9 any vessel, this loss shall be considered
gross average, to which the vessels saved shall contribute.
No!es:
ReCuisites for general average:
. ommon danger
5. 2or the common safety, part of the vessel or the cargo, or both is sacrificed
deliberately
0. 2rom the expenses or damages caused follows the successful saving of the
vessel and cargo
?. 1he expenses or damages should have been incurred or inflicted after
tal9ing legal steps and authority
5#6 Essen!ial Re&uisi!es
 Article 70. n order to incur the expenses and cause the damages corresponding to
gross average, a previous resolution of the captain, adopted after deliberation with
the sailing mate and other officers of the vessel, and with a hearing of the persons
interested in the cargo who may be present, shall be reCuired.
f the latter shall ob#ect, and the captain and officers, or a ma#ority, or the captain, if
opposed to the ma#ority, should consider certain measures necessary, they may be
executed under his liability, without pre#udice to the freighters exercising their rights
against the captain before the #udge or court of competent #urisdiction, if they can
prove that he acted with malice, lac9 of s9ill, or negligence.
f the persons interested in the cargo, being on the vessel, should not be heard, they
shall not contribute to the gross average, which contribution shall be paid by the
captain, unless the urgency of the case should be such that the time necessary for
previous deliberation was lac9ing.
 Article 7?. 1he resolution adopted to cause the damages which constitute a general
average must necessarily be entered in the log boo9, stating the motives and reasons
therefor, the votes against it, and the reasons for the disagreement should there be
any, and the irresistible and urgent causes which moved the captain if he acted of his
own accord.
?  of ,- 
 n the first case the minutes shall be signed by all the persons present who could do 5. 1hose in the hold, always beginning with those of the greatest weight and
so before ta9ing action if possible, and if not at the first opportunityE in the second smallest value, to the amount and number absolutely indispensable.
case by the captain and by the officers of the vessel.
n the minutes and after the resolution there shall be stated in detail all the goods  Article 7>. n order that the goods #ettisoned may be included in the gross average
cast away, and mention shall be made of the in#uries caused to those 9ept on board. and the owners thereof be entitled to indemnity, it shall be necessary in so far as the
1he captain shall be obliged to deliver one copy of these minutes to the maritime cargo is concerned that their existence on board be proven by means of the bill of
 #udicial authority of the first port he may ma9e within twenty6four hours after his ladingE and with regard to those belonging to the vessel, by means of the inventory
arrival, and to ratify it immediately by an oath. made up before the departure, in accordance with the first paragraph of Article >5.
 Article 7>@. f, notwithstanding the #ettison of the merchandise, brea9age of masts,
ropes, and eCuipment, the vessel should be lost running said ris9, no contribution 5e6 Kason Clauses 5Yor9=An!2er" Rules8 Rule D6
whatsoever by reason of gross average shall be proper. Rights to contribution in general average shall not be affected, though the
1he owners of the goods saved shall not be liable for the indemnity of those event which gave rise to the sacrifice or expenditure may have been due to the
 #ettisoned, lost, or damaged. fault of one of the parties to the adventureE but this shall not pre#udice any
remedies or defenses which may be open against or to that party in respect of
A!& 2A1! ;&+B$RA1 B1R/& +A!! such fault.
/1&!
%agsaysay !! !an Antonio, 1he expenses incurred t is the 4. Arri'al Un(er S!ress
nc. v. owned by in floating the ship is deliverance
 Agan %agsaysay, had not a general average: from an No!e: Arrival under stress is the arrival of a vessel at the nearest and most
in its cargo () vessel = cargo immediate, convenient port, if during the voyage the vessel cannot continue the trip to the port
belonging to were at the time in no impending of destination due to: () lac9 of provisionsE (5) a well6founded fear of sei8ure,
 Agan. 1he ship imminent dangerE (5) peril, by a privateers, or piratesE or (0) by reason of any accident of the sea disabling it to
ran aground the cargo, without common navigate.
after having a need of expensive sacrifice, that
stopover so salvage operation, constitutes 5a6 Causes
%agsaysay had have been unloaded the essence
it refloated. by the ownersE (0) of general  Article 73. f during the voyage the captain should believe that the vessel cannot
 Agan did not salvage operation was average. continue the trip to the port of destination on account of the lac9 of provisions, well6
ma9e a for the benefit of the founded fear of sei8ure, privateers, or pirates, or by reason of any accident of the sea
deposit$bond to vessel and not for the disabling it to navigate, he shall assemble the officers and shall summon the persons
answer for the purpose of saving the interested in the cargo who may be present, and who may attend the meeting
contribution to cargoE (?) expenses or without the right to voteE and if, after examining the circumstances of the case, the
the average. damages incurred reason should be considered well6founded, the arrival at the nearest and most
were not ta9en convenient port shall be agreed upon, drafting and entering the proper minutes,
through proper legal which shall be signed by all, in the log boo9.
steps and authority. 1he captain shall have the deciding vote, and the persons interested in the cargo,
may ma9e the ob#ections and protests they may deem proper, which shall be entered
5c6 E00ec!s in the minutes in order that they may ma9e use thereof in the manner they may
 Article 75. n order to satisfy the amount of the gross or general averages, all the consider advisable.
persons having an interest in the vessel and cargo therein at the time of the
occurrence of the average shall contribute.  Article 75@. An arrival shall not be considered lawful in the following cases:
. f the lac9 of provisions should arise from the failure to ta9e the necessary
5(6 Ke!!ison8 Ar!s. ,8 ,? provisions for the voyage according to usage and customs, or if they should
have been rendered useless or lost through bad stowage or negligence in
 Article 74. 1he captain shall supervise the #ettison, and shall order the goods cast their care.
overboard in the following order: 5. f the ris9 of enemies, privateers, or pirates should not have been well
. 1hose which are on dec9, beginning with those which embarrass the 9nown, manifest, and based on positive and provable facts.
handling of the vessel or damage her, preferring, if possible, the heaviest
ones and those of least utility and value.

  of ,- 
 0. f the defect of the vessel should have arisen from the fact that it was not
repaired, rigged, eCuipped, and prepared in a manner suitable for the
voyage, or from some erroneous order of the captain.
?. hen malice, negligence, want of foresight, or lac9 of s9ill on the part of the
captain exists in the act causing the damage.
5#6 ;or/ali!ies
 Article 73. f during the voyage the captain should believe that the vessel cannot
continue the trip to the port of destination on account of the lac9 of provisions, well6
founded fear of sei8ure, privateers, or pirates, or by reason of any accident of the sea
disabling it to navigate, he shall assemble the officers and shall summon the persons
interested in the cargo who may be present, and who may attend the meeting
without the right to voteE and if, after examining the circumstances of the case, the
reason should be considered well6founded, the arrival at the nearest and most
convenient port shall be agreed upon, drafting and entering the proper minutes,
which shall be signed by all, in the log boo9.
1he captain shall have the deciding vote, and the persons interested in the cargo,
may ma9e the ob#ections and protests they may deem proper, which shall be entered
in the minutes in order that they may ma9e use thereof in the manner they may
consider advisable.
 Article 755. f in order to ma9e repairs to the vessel or because there is danger that
the cargo may suffer damage, it should be necessary to unload, the captain must
reCuest authori8ation from the competent #udge or court for the removal, and carry it
out with the 9nowledge of the person interested in the cargo, or his representative,
should there be any.
n a foreign port, it shall be the duty, of the Philippine onsul, where there is one, to
give the authori8ation.
n the first case, the expenses shall be for the account of the ship agent or owner,
and in the second, they shall be chargeable against the owners of the merchandise
for whose benefit the act was performed.
f the unloading should ta9e place for both reasons, the expenses shall be divided
proportionately between the value of the vessel and that of the cargo.
5c6 E<"enses
 Article 75. 1he expenses of an arrival under stress shall always be for the account of  5a6 Classes an( E00ec!s
the shipowner or agent, but they shall not be liable for the damages which may be
caused the shippers by reason of the arrival provided the latter is legitimate.
therwise, the ship agent and the captain shall be #ointly liable.
 Article 755. f in order to ma9e repairs to the vessel or because there is danger that
the cargo may suffer damage, it should be necessary to unload, the captain must
reCuest authori8ation from the competent #udge or court for the removal, and carry it
out with the 9nowledge of the person interested in the cargo, or his representative,
should there be any.
n a foreign port, it shall be the duty, of the Philippine onsul, where there is one, to
give the authori8ation.
n the first case, the expenses shall be for the account of the ship agent or owner,
and in the second, they shall be chargeable against the owners of the merchandise
for whose benefit the act was performed.
f the unloading should ta9e place for both reasons, the expenses shall be divided
proportionately between the value of the vessel and that of the cargo.
5(6 Res"onsi#ili!$ o0 Ca"!ain
 Article 750. 1he custody and preservation of the cargo which has been unloaded shall
be intrusted to the captain, who shall be responsible for the same, except in cases of
force ma#eure.
 Article 75?. f the entire cargo or part thereof should appear to be damaged, or there
should be imminent danger of its being damaged, the captain may reCuest of the
competent #udge or court, or of the consul in a proper case, the sale of all or of part
of the former, and the person ta9ing cogni8ance of the matter shall authori8e it, after
an examination and declaration of experts, advertisements, and other formalities
reCuired by the case, and an entry in the boo9, in accordance with the provisions of
 Article >5?.
1he captain shall, in a proper case, #ustify the legality of his conduct, under the
penalty of answering to the shipper for the price the merchandise would have
brought if they had arrived in good condition at the port of destination.
 Article 754. 1he captain shall be responsible for the damages caused by his delay, if
after the cause of the arrival under stress has ceased, he should not continue the
voyage. f the cause of arrival should have been the fear of enemies, privateers, or
pirates, a deliberation and resolution in a meeting of the officers of the vessel and
persons interested in the cargo who may be present, in accordance with the
provisions contained in Article 73, shall precede the departure
. Collisions
No!es:
ollision O the impact of 5 moving vessels
 Allision O the stri9ing of a moving vessel against one that is stationary, or a vessel
and other floating, though non6navigable ob#ects
5,6 ;or!ui!ous
 Article 70@. f a vessel should collide with another, through fortuitous event or force
ma#eure, each vessel and its cargo shall bear its own damages.
 Article 705. f by reason of a storm or other cause of force ma#eure, a vessel which is
properly anchored and moored should collide with those nearby, causing them
damages, the in#ury occasioned shall be considered as particular average of the
vessel run into.
546 Cul"a#le
  of ,- 
 the consigned the mortgagee both shall be
 Article 75>. f a vessel should collide with another, through or the fault, negligence, lost$damaged and solidarily
or lac9 of s9ill of the captain, sailing mate, or any other member of the complement, cargoes see9s to manager$operator responsible for
the owner of the vessel at fault shall indemnify the losses and damages suffered, recover. of Bona /ati the losses and
after an expert appraisal. respectively, are damages suffered
both liable to BevDt by their cargoes.
 Article 75-. f the collision is imputable to both vessels, each one shall suffer its own nsurance.
damages, and both shall be solidarily responsible for the losses and damages ovDt v. 1he ovDt see9s to 1he owners of here both
occasioned to their cargoes. Phil. recover the value both vessels are vessels are to
!teamship of sac9s of rice liable for the loss blame, both shall
 Article 70. f a vessel should be forced by a third vessel to collide with another, the which were lost at of sac9s of rice. be solidarily
owner of the third vessel shall indemnify the losses and damages caused, the captain sea, as a result of  AntipoloDs mate responsible for
thereof being civilly liable to said owner. a collision was negligent in the damage
between the having permitted occasioned to
56 Inscru!a#le ;aul! steamer Antipolo the vessel to their cargoes.
owned by the Phil. approach directly
 Article 757. 1he provisions of the preceding article are applicable to the use in which !teamship, and towards the sabel
it cannot be determined which of the two vessels has caused the collision. the vessel sabel, until the two were
upon which said in dangerous
A!& 2A1! ;&+B$RA1 B1R/& +A!! rice was proximity.
/1&! embar9ed.
 A. 'rrutia  A collision 1hose managing 1he steamerDs !mith "ell %$ Bon arlos, %$ Bon arlos hen 5 power6
= o. v. occurred between the steamer were greater facility of and o. v. owned by o was negligent and driven vessels are
"aco River a steamship and a guilty of gross maneuvering over A 1hong collided at fault in the meeting end on,
Plantation sail vessel. 1he negligenceE and so a sail vessel with %$! Gotai collision: () while or nearly end on,
sail vessel 9ept its they could recover means it has the %aru resulting to %$! Gotai %aru so as to involve
course until #ust nothing. 1he greater ability to the latterDs having turned to its right, ris9 of collision,
before its steamer was avoid collisionsE holes on her %$ Bon arlos each shall alter
helmsman threw brought into such so as a general portside through turned to its leftE her course to
it hard to port close proximity to rule, when which seawater (5) Bon arlos starboard (right
(left side) in an the sail vessel that meeting a sailing rushed in, failed to have on side), so that
effort to avoid the a collision was vessel, whether damaging all its board Iproper each may pass on
collision. "ut the apparently close hauled or cargo. 1he loo96outJE (0) Bon the port (left) side
movement was inevitable. with the wind insurance arlosD 5nd mate of the other.
unsuccessful and free, the sail companies as was, immediately
the sail vessel vessel has a right subrogees before and during
rammed the to 9eep her commenced the collision, in
steamer. 1he course, and it is actions against o command
steamer san9 and the duty of the 1hong for although its
7 lives were lost. steamer to adopt damages captain, was in the
1he sail vessel precautions as will sustained by the vessel at the time.
was considerably avoid the sail shipments.
in#ured. vessel.
/ational /ational BevDtDs  A vessel who  Art. 75- provides >. Si"2rec9s
BevDt o. Bona /ati collided suffers collision that if the collision
v. A, with !! through its own is imputable to  Article 7?@ . 1he losses and deteriorations suffered by a vessel and her cargo by
supra   Gasushima %aru. fault must bear its both vessels, each reason of shipwrec9 or stranding shall be individually for the account of t he owners,
BevDt nsurance, own losses, so one shall suffer its the part which may be saved belonging to them in the same proportion.
as subrogee of /BP and %P, as own damages and

  of ,- 
 Article 7?. f the wrec9 or stranding should be caused by the malice, negligence, or
lac9 of s9ill of t he captain, or because the vessel put to sea was insufficiently repaired
and eCuipped, the shipagent or the shippers may demand indemnity of the captain
for the damages caused to the vessel or to the cargo by the accident, in accordance
with the provisions contained in Articles >@, >5, >?, and >5.
 Article 7?5 . 1he goods saved from the wrec9 shall be specially bound for the payment
of the expenses of the respective salvage, and the amount thereof must be paid by
the owners of the former before they are delivered to them, and with preference over
any other obligation if the merchandise should be sold.
 Article 7?0 . f several vessels sail under convoy, and any of them should be wrec9ed,
the cargo saved shall be distributed among the rest in proportion to the amount
which each one is able to ta9e.
f any captain should refuse, without sufficient cause, to receive what may
correspond to him, the captain of the wrec9ed vessel shall enter a protest against
him, before two sea officials, of the losses and damages resulting therefrom, ratifying
the protest within twenty6four hours after arrival at the first port, and including it in
the proceedings he must institute in accordance with the provisions contained in
 Article >5.
f it is not possible to transfer to the other vessels the entire cargo of the vessel
wrec9ed, the goods of the highest value and smallest volume shall be saved first, the
designation thereof to be made by the captain with the concurrence of the officers of
his vessel
No!es: !hipwrec9 O a ship which has received in#uries rendering her incapable of
navigationE or loss of a vessel at sea, either by being swallowed up by the waves, by
running against another vessel or thing at sea, or on the coast
en Rule: n shipwrec9, each owner shall bear his own losses, such as those arising
from force ma#eure
&xcept: aptain shall be liable in case the wrec9 or stranding is due to the () malice,
negligence, or slac9 of s9ill of the captain, or (5) because the vessel put to sea was
insufficiently repaired and eCuipped
5a6 Sal'a)e La2 5Ac! No. 4?,?6
!&1/ . hen in case of shipwrec9, the vessel or its cargo shall be beyond the
control of the crew, or shall have been abandoned by them, and pic9ed up and
conveyed to a safe place by other persons, the latter shall be entitled to a reward for
the salvage.
1hose who, not being included in the above paragraph, assist in saving a vessel or its
cargo from shipwrec9, shall be entitled to a li9e reward.
!&1/ 5. f the captain of the vessel, or the person acting in his stead, is present,
no one shall ta9e f rom the sea, or from the shores or coast merchandise or effects
proceeding from a shipwrec9 or proceed to the salvage of the vessel, without the
consent of such captain or person acting in his stead.
!&1/ 0. ;e who shall save or pic9 up a vessel or merchandise at sea, in the
absence of the captain of the vessel, owner, or a representative of either of them,
they being un9nown, shall convey and deliver such vessel or merchandise, as soon as
possible, to the ollector of ustoms, if the port has a collector, and otherwise to the
provincial treasurer or municipal mayor.
!&1/ ?. After the salvage is accomplished, the owner or his representative shall
have a right to the delivery of the vessel or things saved, provided that he pays, or
gives a bond to secure, the expenses and the proper reward.
1he amount and sufficiency of the bond, in the absence of agreement, shall be
determined by the ollector of ustoms or by the <udge of the ourt of 2irst nstance
of the province in which the t hings saved may be found.
!&1/ 4. 1he ollector of ustoms, provincial treasurer, or municipal mayor, to
whom a salvage is reported, shall order:
a. 1hat the things saved be safeguard and inventoried.
b. 1he sale at public auction of the things saved which may be in danger of
immediate loss or of those whose conservation is evidently pre#udicial to the
interests of the owner, when no ob#ection is made to such sale.
c. 1he advertisement within the thirty days subseCuent to the salvage, in one
of the local newspapers or in t he nearest newspaper published, of all the
details of the disaster, with a statement of the mar9 and number of the
effects reCuesting all interested persons to ma9e their claims.
!&1/ >. f, while the vessel or things saved are at the disposition of the
authorities, the owner or his representative shall claim them, such authorities shall
order their delivery to such owner or his representative, provided that there is no
controversy over their value, and a bond is given by the owner or his representative
to secure the payment of the expenses and the proper reward. therwise, the
delivery shall nor be made until the matter is decided by the ourt of 2irst nstance of 
the province.
!&1/ -. /o claim being presented in the three months subseCuent to the
publication of the advertisement prescribed in sub6section (c) of !ection five, the
things save shall be sold at public auction, and their proceeds, after deducting the
expenses and the proper reward shall be deposited in the insular treasury. f three
years shall pass without anyone claiming it, one6half of the deposit shall be ad#udged
to him who saved the things, and the other half to the insular government.
!&1/ 7. 1he following shall have no right to a reward for salvage or assistance:
a. 1he crew of the vessel shipwrec9ed or which was is danger of shipwrec9E
b. ;e who shall have commenced the salvage in spite of opposition of the
captain or his representativeE and
c. ;e who shall have failed to comply with the provisions of !ection three.
!&1/ 3. f, during the danger, an agreement is entered into concerning the
amount of the reward for salvage or assistance, its validity may be impugned
because it is excessive, and it may be reCuired to be reduced to an amount
proportionate to the circumstances.
-  of ,- 
 to a safe port. but also as an salvage.
!&1/ @. n a case coming under the last preceding section, as well as in the !alvor see9s incentive to render
absence of an agreement, the reward for salvage or assistance shall be fixed by the remuneration for prompt and efficient
ourt of 2irst nstance of the province where the things salvaged are found, ta9ing the salvage aid in such cases
into account principally the expenditures made to recover or save the vessel or the service it when reCuested by
cargo or both, the 8eal demonstrated, the time employed, the services rendered, the rendered. those in the midst of 
excessive express occasioned the number of persons who aided, the danger to which such unfortunate
they and their vessels were exposed as well as that which menaced the things circumstances.
recovered or salvaged, and the value of such things after deducting the expenses. &rlanger !teamship /ippon 1he ship is deemed 1he relief of
= = its crew left the abandoned and &= property from
!&1/ . 2rom the proceeds of the sale of the things saved shall be deducted, alinger ship and arrived at has a valid salvage an impending
first, the expenses of their custody, conservation, advertisement, and auction, as well (&=) v. Kambales. 1he claim for it satisfied peril of the sea,
as whatever taxes or duties they should pay for their entranceE then there shall be !wedish ship was stranded the 0 reCuisites: () by the voluntary
deducted the expenses of salvageE and from the net amount remaining shall be ta9en &ast but the remaining marine perilE (5) exertions of
the reward for the salvage or assistance which shall not exceed fifty per cent of such  Asiatic goods and crews service voluntarily those who are
amount remaining. o. were eventually rendered when not under no legal
fetched. reCuired as an obligation to
!&1/ 5. f in the salvage or in the rendering of assistance different persons shall &= proceeded to existing duty or from render
have intervened the reward shall be divided between them in proportion to the tow Ithe stranded a special contractE assistance, and
services which each one may have rendered, and, in case of doubt, in eCual parts. and abandoned (0) success, in whole the conseCuent
1hose who, in order to save persons, shall have been exposed to the same dangers /ipponJ and or in part, or that ultimate safety
shall also have a right to participation in the reward. brought an action the service rendered of the property,
against the contributed to such constitute a
!&1/ 0. f a vessel or its cargo shall have been assisted or saved, entirely or insurance success. case of salvage.
partially, by another vessel, the reward for salvage or for assistance shall be divided companies who
between the owner, the captain, and the remainder of the crew of the latter vessel, represented the
so as to give the owner a half, the captain a fourth, and all the remainder of the crew cargo salved from
the other fourth of the reward, in proportion to their respective salaries, in the the /ippon.
absence of an agreement to the contrary. 1he express of salvage, as well as the  Atlantic, hile Fyodo %aru  Atlantic ulf is n fixing the
reward for salvage or assistance, shall be a charge on the things salvaged on their ulf = was discharging entitled to reward for
value. Pacific its coal in %anila compensation but its salvage, the ff
o. v. "ay, it hit one of amount claimed was should be
No!es: 'chida its submerged exorbitant. n the considered:
Fey &lements of !alvage: Fisen lighter perforating absence of an expenditures
. Act$service rendered Faisha the shipMs hull so it agreement, the made to recover
5. oods rescued began to sin9. court may fix the or save the
0. ompensation  Atlantic ulf reward for salvage vessel or the
?. Berelict salvaged the ship in the province cargo or both,
and see9s to where things are demonstrated
A!& 2A1! ;&+B$RA1 B1R/& +A!! recover found. 8eal, time
/1&! compensation. employed,
. Buring a storm !alvor is entitled to 1he towage of a rendered
'rrutia =  the steamer remuneration. vessel in peril to services,
o. v. /uestra !eUora ompensation in some place of excessive
1he Pasig belonging to  such cases deserves security, when it expenses
!teamer 'rrutia, salvaged to be considered as is unable by incurred, no. of
and 1he Pasig a reward for the itself to reach persons who
+ighter !teamerDs !an service rendered in the same, is a aided, level of
o. <uan by ta9ing it the midst of a peril service of exposure to

, of ,- 
 danger, andE a. until a fixed day O determined no. of days$month
whatever b. for a voyage O either outgoing or return, or round trip
 Imenaced the 0. As to freightage
things a. for a fixed amount for the whole cargo
recovered or b. for a fixed rate per ton
salvagedJ and c. for so much per month
the value of the
said things after A!& 2A1! ;&+B$RA1 B1R/& +A!!
deducting the /1&!
expenses Planters Planters bought  A common f the charter
"arrios v. apt. "arrios of !ervice rendered by 0 elements to a Products v. urea fertili8er carrier shall agreement
o % ;enry  "arrios constituted valid salvage A, supra  from %itsubishi remain as such, entered into is one
1hong received an !! mere ItowageJ since claim: () a which Planters notwithstanding of
signal from % there was no danger marine perilE (5) shipped aboard the charter of demise$bareboat
Bon Alfredo of the vessel service the %$ !un the whole or charter, the carrier
owned by o capsi8ing, in view of voluntarily Plum. Prior to its part of the becomes private
1ong. apt. the fairness of the rendered when voyage, a time vessel by one or and the
"arrios steered sea, and the not reCuired as charter6party on more persons, presumption of
towards % Bon condition of the an existing duty the vessel was provided the negligence does
 Alfredo and towed weather. Although or from a entered into charter is limited not arise.
it. t was due to % Bon Alfredo was special contractE between its owner to the ship only,
% Bon AlfredoMs drifting towards the and (0) success and %itsubishi as as in the case of 
engine failure and open sea, there was in whole or in shipper$charterer. a time6charter or
loss of propeller no danger of it part, or that the 'pon arrival, urea voyage6charter.
that it was drifting floundering or being service shortage and "ut common
slowly in the open stranded, as it was rendered contamination carrier is still not
sea, at a far from any island contributed to was reported. liable due to its
moderate wind. or roc9s. such success. Planters filed an &B.
"arrios see9s to action for
recover damages.
compensation for oastwise Pag6asa !ales oastwiseDs  As common carrier
 IsalvageJ  +ighterage entered into a contract with the is liable for breach
orp. v. A contract to consignee was of the contract of
E. S"ecial Con!rac!s o0 *ari!i/e Co//erce transport one of carriage, having
,. Car!er Par!ies molasses w$ affreightment T failed to overcome
a. De0ini!ion oastwise, using where the vessel the presumption
the latterDs dumb owner leases of negligence with
No!e: harter party is a contract by virtue of which the owner or the agent of the barges. "ut one part or all of its the loss and
vessel binds himself to transport merchandise or persons for a fixed price. t is also a of the barges space to haul destruction of
lease of the whole or a portion of the vessel for the transportation of goods pr person struc9 an goods for goods it
from one port to another. un9nown sun9en others. transported, by
ob#ect which oastwise was proof of its
#. 3in(s made a hole not converted exercise of &B.
causing water to into a private
No!es: gush in through it. carrier, but
. As to extent of vessel hired  As a result, the remained a
a. total O whole vessel chartered molasses at the common carrier
b. partial O only a part of the vessel chartered cargo tan9s were and was still
5. As to time contaminated and liable as such.

4  of ,- 
 became unfit for 1here was no  Article -3. A loan in which under any condition whatever, the repayment of the sum
the use it was proof of the loaned and of the premium stipulated depends upon the safe arrival in port of the
intended. exercise of &B. goods on which it is made, or of the price they may receive in case of accident, shall
altex %1 ector carried altex = %1  A charter party is be considered a loan on bottomry or respondentia.
Phils. v. altexMs gasoline  ector entered a contract by
!ulpicio by virtue of a into a contract which an entire No!es:
+ines charter contract of affreightment, ship, or some +oan on bottomry or respondentia is a real, unilateral, aleatory contract where:
between them. also 9nown as a principal part () delivery of the amount loaned is necessary for the perfection of the
%1 ector and % voyage charter. thereof, is let by contractE
Bona Pa8 (owned altex, as a the owner to (5) although there are reciprocal benefits, the contract produces obligations only
by !ulpicio +ines) charterer, has another person for for  party, the borrower, who must return the amount borrowed plus
collided which no obligation a specified time or premiumE and
9illed the latterMs before use. 1he charterer (0) the lender really runs 9nown ris9s
passengers. transporting its mans the vessel +oan on bottomry or respondentia, unli9e ordinary loan, is not sub#ect to the
!ulpicio filed a cargo to ensure with his own provisions of the 'sury +aw O there is no limit as to the rate of the intrest in view of
complaint against that the vessel it people and the fact that there are different classes and various accidents to which maritime
altex for having chartered becomes, in voyages are exposed.
chartered %1 complied with all effect, the owner
 ector w$ gross legal for the voyage or ;. Bill o0 La(in)
and evident bad reCuirements. service stipulated,
faith. 1he duty rests sub#ect to liability No!es: "ill of lading operates both as a:
upon the for damages . receipt for the goods shipped which contains date, place of shipment, goods
common carrier caused by description, conditions Cuality and value
simply for being negligence. 5. contract to transport and deliver the goods as stipulated which contains
engaged in partiesD names, fixed route, destination and freight charges, rights and
 Ipublic service.J obligations assumed by the parties

4. Loans on Bo!!o/r$ an( Res"on(en!ia ,. Con!en!s

a. Loan on Bo!!o/r$8 (e0ine(
 
No!es: +oan on bottomry is a contract in the nature of a mortgage, by which the
shipowner borrows money for the use, eCuipment or repair of the vessel, and for a
definite term, pledges the ship (or its 9eel and bottom) as a security for its
repayment.
f the ship is lost in the course of a voyage, or during the limited time, by any of the
perils enumerated in the contract, then the lender shall also lose his money.
#. Loan on Res"on(en!ia8 (e0ine(
No!es: +oan on respondentia is one made on the goods laden on board the ship, and
which are to be sold or exchanged in the course of the voyage the borrowerDs
personal responsibility being deemed the principal security for t he performance of the
contract, which is called respondentia.
&ven though the ship perishes, the lender must be paid his principal and interest,
provided that the goods are saved.
 
c. Carac!er o0 Loan
Article -@>. 1he captain of the vessel and the shipper shall have the obligation of
drawing upthe bill of lading in which shall be stated:
. 1he name, registry, and tonnage of the vessel.
5. 1he name of the captain and his domicile.
0. 1he port of loading and that of unloading.
?. 1he name of the shipper.
4. 1he name of the consignee, if the bill of lading is issued in the name of a
specified person.
>. 1he Cuantity, Cuality, number of pac9ages and mar9s of the merchandise.
-. 1he freightage and the primage stipulated.
1he bill of lading may be issued to bearer, to order, or in the name of a specified
person, and must be signed within twenty6four hours after the cargo has been
received on board, the shipper being entitled to demand the unloading at the
expense of the captain should the latter not sign it, and, in every case, the losses and
damages suffered thereby
Article -@-. 2our true copies of the original bill of lading shall be made, and all of
them shall be signed by the captain and the shipper. f these, the shipper shall 9eep
one and send another to the consigneeE the captain shall ta9e two, one for himself
and another for the ship agent.

:  of ,- 
1here may also be drawn up as many copies of the bill of lading as may be
considered necessary by the person interestedE but when they are issued to order or
to bearer, they shall be stated in all the copies, be they the first four or the
subseCuent ones, the destination of each one, stating whether it is for the agent, for
the captain, for the shipper, or for the consignee. f the copy sent to the latter should
have a duplicate, this circumstance and the fact that it is not valid except in default of   Article >30. f the passage price has not been agreed upon, the #udge or court shall
the first one must be stated therein.
 Article -0. f before the delivery of the cargo a new bill of lading should be
demanded of the captain, on the allegation that the failure to present the previous
ones is due to their loss or to any other #ust cause, he shall be obliged to issue it,
provided that security for the value of the cargo is given to his satisfaction, but
without changing the consignment, and stating therein the circumstances prescribed
in the last paragraph of Article -@-, under penalty, should he not so state, of being
held liable for said cargo if improperly delivered through his fault.
 Article -?. f before the vessel puts to sea the captain should die or should cease to
hold his position through any cause, the shippers shall have the right to demand of
the new captain the ratification of the first bills of lading, and the latter must do so,
provided that all the copies previously issued be presented or returned to him, and it
should appear from all examination of the cargo that they are correct.
No!e: 1he bill must be in writing and signed within 5? hours after the cargo has
been received on board. therwise, the shipper may demand () the unloading of the
goods at the captainDs expense and (5) the payment of the losses and damages
suffered by the captainDs refusal to sign the bill.
4. Pro#a!i'e Value
 Article -@3. A bill of lading drawn up in accordance with the provisions of this title
shall be proof as between all those interested in the cargo and between the latter and
the insurers, proof to the contrary being reserved for the latter.
 Article -@ . f the bills of lading do not agree, and no change or erasure can be
observed in any of them, those possessed by the shipper or consignee signed by the
captain shall be proof against the captain or ship agent in favor of the consignee or
shipperE and those possessed by the captain or ship agent signed by the shipper shall
be proof against the shipper or consignee in favor of the captain or ship agent.
No!es: 'nder Art -@3, the bill of lading properly drawn shall be proof between the
parties of their agreements. Art -@ governs the case where the bill of lading do not
agree, and no change or erasure can be observed in any of them. n case of conflict
in the provisions of the charter party and the bill of lading, even when both appear
unaltered, the contents of the bill of lading prevail.
ssuance of bill of lading is not proof of loading of goods.
G. Passen)er on Sea Vo$a)e
,. Na!ure o0 Con!rac!s
 Article >34. 1he right to passage, if issued to a specified person, cannot be
transferred without the consent of the captain or of the consignee.
4. O#li)a!ions o0 Passen)ers
summarily fix it, after a declaration of experts.
 Article >33. f the contract is rescinded, before or af ter the commencement of the
voyage, the captain shall have a right to claim payment of what he may have
furnished the passengers.
 Article -@?. 1he captain, in order to collect the passage6money and expenses of
sustenance, may retain the goods belonging to the passenger, and in case of the sale
of the same he shall be given preference over other creditors acting the same way as
in the collection of freightage
 Article >3?. !hould the passenger not arrive on board at the time fixed, or should
leave the vessel without permission from the captain when the latter is ready to leave
the port, the captain may continue the voyage and demand the full passage price.
 Article -@@. n all matters pertaining to the preservation of order and discipline on
board the vessel passengers shall be sub#ect to the orders of the captain, without any
distinction whatsoever.
. Ri)!s o0 Passen)ers
 Article >3-. f before the voyage is begun it is suspended through the exclusive fault
of the captain or ship agent, the passengers shall have the right to a refund of their
fares and to recover losses and damagesE but if the suspension is due to fortuitous
events, or to force ma#eure, or to any other cause independent of the captain or ship
agent, the passengers shall only be entitled to t he return of the fare.
 Article >37. n case a voyage already begun should be interrupted, the passengers
shall be obliged to pay the fare in proportion to the distance covered, without right to
recover for losses and damages if the interruption is due to fortuitous event or to
force ma#eure, but with a right to indemnity if the interruption should have been
caused by the captain exclusively. f the interruption should be caused by the
disability of the vessel, and a passenger should agree to await the repairs, he may
not be reCuired to pay any increased price of passage, but his living expenses during
the stay shall be for his own account.
n case of delay in the departure of the vessel, the passengers have the right to
remain on board and to be furnished with food for the account of the vessel unless
the delay is due to fortuitous events or to force ma#eure. f the delay should exceed
ten days, passengers reCuesting the same shall be entitled to the return of the fareE
and if it is due exclusively to the fault of the captain or ship agent, they may also
demand indemnity for losses and damages.
>  of ,- 
 A vessel exclusively devoted to the transportation of passengers must ta9e them ity instead. 1he 1rans6Asia is ode.
directly to the port or ports of destination, no matter what the number of passengers captain acceded. liable for moral
may be, ma9ing all the stops indicated in its itinerary. and exemplary
damages
A!& 2A1! ;&+B$RA1 B1R/& +A!! because of its
/1&! non6fulfillment
!weet +ines Pvt respondents "ypassing the n case of of the implied
v. A purchased st port of interruption of a warranty of
class tix from atbalogan w$o voyage already seaworthiness.
!weet +ines giving notice, or begun, the
bound for offer to bring passengers shall H. Carria)e o0 Goo(s #$ Sea Ac! 5Co//on2eal! Ac! No. ? Pu#lic Ac!. No.
atbalogan but pvt respondents only be obliged to 4,8 >! US Con)ress6
not only was to their pay the fare in
there a 06hr late destination at proportion to the !ection . hen used in this Act S
departure but its expense, or distance covered, (a) 1he term NcarrierN includes the owner or the charterer who enters into a contract
the ship was also refund the without right to of carriage with a shipper.
towed bac9 to value of the recover damages if (b) 1he term Ncontract of carriageN applies only to contracts of carriage covered by a
ebu due to tic9ets the interruption is bill of lading or any similar document of title, insofar as such document relates to the
engine trouble. purchased, was due to fortuitous carriage of goods by sea, including any bill of lading or any similar document as
Repairs were bad faith on event or force aforesaid issued under or pursuant to a charter party from the moment at which such
completed the petitionerDs part ma#eure, but with a bill of lading or similar document of title regulates the relations between a carrier and
following day but so damages are right to indemnity, a holder of the same.
instead of awarded if the interruption (c) 1he term NgoodsN includes goods, wares, merchandise, and articles of every 9ind
doc9ing at accordingly. should have been whatsoever, except live animals and cargo which by the contract of carriage is stated
atbalogan, the caused by the as being carried on dec9 and is so carried.
vessel directed captain exclusively. (d) 1he term NshipN means any vessel used for the carriage of goods by sea.
to 1acloban. (e) 1he term Ncarriage of goodsN covers the period from the time when the goods are
1rans6Asia  Atty. Arroyo 1he vessel was  Art. >37 must be loaded on to the time when they are discharged from the ship.
!hipping v. bought a tic9et unseaworthy read together with
A from 1rans6Asia even before the  Arts. 533, 55@@, R!F!
bound to B voyage began. 55@, and 55@7 in !ection 5. !ub#ect to the provisions of section >, under every contract of carriage of
from ebu. &ven before it relation to Art 5 of  goods by sea, the carrier in relation to the loading handling, stowage, carriage,
 Arroyo noticed could finish the ivil ode. n custody, care, and discharge of such goods, shall be sub#ect to the responsibilities
that some repair these repairs, it doing so, there was and liabilities and entitled to the rights and immunities hereinafter set forth.
wor9s were allowed the no delay on 1rans
being vessel to leave  Asia, hence Arroyo R&!P/!"+1&! A/B +A"+1&!
underta9en on the port of is /1 entitled to !ection 0. () 1he carrier shall be bound, before and at the beginning of the voyage,
the vesselMs origin on only  actual damages. to exercise due diligence to 6
engine. 1he functioning  As to the rights and (a) %a9e the ship seaworthyE
vessel departed engine, instead duties of the parties (b) Properly man, eCuip, and supply the shipE
w$ only  engine of 5. &ven the strictly arising out (c) %a9e the holds, refrigerating and cooling chambers, and all other parts of
running until it lone functioning of such delay, Art. the ship in which goods are carried, fit and safe for their reception carriage
stopped and engine was not >37 specifically and preservation.
dropped its in perfect provides for such a (5) 1he carrier shall properly and carefully load, handle, stow, carry, 9eep, care for,
anchor. !ome condition as situation. 1his and discharge the goods carried.
passengers sometime after article applies (0) After receiving the goods into his charge the carrier, or the master or agent of the
demanded that it had run its suppletorily carrier, shall, on demand of the shipper, issue to the shipper a bill of lading showing
they be allowed course, it pursuant to Art among other things S
to return to ebu con9ed out. ->> of the ivil

  of ,- 
 (a) 1he leading mar9s necessary for identification of the goods as the same are
furnished in writing by the shipper before the loading of such goods starts,
provided such mar9s are stamped or otherwise shown clearly upon the
goods if uncovered, or on the cases or coverings in which such goods are
contained, in such a manner as should ordinarily remain legible until the end
of the voyage.
(b) &ither the number of pac9ages or pieces, or the Cuantity or weight, as the
case may be, as furnished in writing by the shipper.
(c) 1he apparent order and conditions of the goods: Provided, 1hat no carrier,
master, or agent of the carrier, shall be bound to state or show in the bill of
lading any mar9s, number, Cuantity, or weight which he has reasonable
ground for suspecting not accurately to represent the goods actually
received, or which he has had no reasonable means of chec9ing.
(?) !uch a bill of lading shall be prima facie evidence of the receipt by the carrier of
the goods as therein described in accordance with paragraphs (0) (a), (b), and (c) of  and cool chambers, and all other parts of the ship in which goods are carried fit and
this section: (1he rest of the provision is not applicable to the Philippines).
(4) 1he shipper shall be deemed to have guaranteed to the carrier the accuracy at
the time of shipment of the mar9s, number, Cuantity, and weight, as furnished by
himE and the shipper shall indemnify the carrier against all loss, damages, and
expenses arising or resulting from inaccuracies in such particulars. 1he right of the
carrier to such indemnity shall in no way limit his responsibility and liability under the
contract of carriage to any person other than the shipper.
(>) 'nless notice or loss or damage and the general nature of such loss or damage
by given in writing to the carrier or his agent at the port of discharge or at the time
of the removal of the goods into the custody of the person entitled to delivery thereof  (c) Perils, dangers, and accidents of the sea or other navigable watersE
under the contract of carriage, such removal shall be prima facie evidence of the
delivery by the carrier of the goods as described in the bill of lading. f the loss or
damage is not apparent, the notice must be given within three days of the delivery.
!aid notice of loss or damage may be endorsed upon the receipt for the goods given
by the person ta9ing delivery thereof.
1he notice in writing need not be given if the state of the goods has at the time of
their receipt been the sub#ect of #oint survey or inspection.
n any event the carrier and the ship shall be discharged from all liability in respect of  representativeE
loss or damage unless suit is brought within one year after delivery of the goods or
the date when the goods should have been delivered: Provided, that, if a notice of
loss or damage, either apparent or concealed, is not given as provided for in this
section, that fact shall not affect or pre#udice the right of the shipper to bring suit
within one year after the delivery of the goods or the date when the goods should
have been delivered.
n the case of any actual or apprehended loss or damage, the carrier and the receiver
shall give all reasonable facilities to each other for inspecting and tallying the goods.
(-) After the goods are loaded the bill of lading to be issued by the carrier, master,
or agent of the carrier to the shipper shall if the shipper so demands, be a NshippedN
bill of lading: Provided, that if the shipper shall have previously ta9en up any
document of title to such goods, he shall surrender the same as against the issue of  without the fault or neglect of the agents or servants of the carrier, but the
the NshippedN bill of lading, but at the option of the carrier such document of title
may be noted at the port of shipment by the carrier, master, or agent with the
name or names of the ship or ships upon which the goods have been shipped and
the date or dates of shipment, and when so noted the same shall for the purpose of
this section be deemed to constitute a NshippedN bill of lading.
(7) Any clause, covenant, or agreement in a contract of carriage relieving the carrier
of the ship from liability for loss or damage to or in connection with the goods, arising
from negligence, fault, or failure in the duties and obligations provide in this section
or lessening such liability otherwise than as provided in this Act, shall be null and void
and of no effect. A benefit of insurance in favor of the carrier, or similar clause, shall
be deemed to be a clause relieving the carrier from liability.
R;1! A/B %%'/1&!
!ection ?. () /either the carrier nor the ship shall be liable for loss or damage
arising or resulting from unseaworthiness unless caused by want of due diligence on
the part of the carrier to ma9e the ship seaworthy, and to secure that the ship is
properly manned, eCuipped, and supplied, and to ma9e to the holds, refrigerating
safe for their reception, carriage, and preservation in accordance with the provisions
of paragraph () of section 0. henever loss or damage has resulted from
unseaworthiness, the burden of proving the exercise of due diligence shall be on the
carrier or other persons claiming exemption under the section.
(5) /either the carrier nor the ship shall be responsible for loss or damage arising or
resulting from S
(a) Act, neglect, or default of the master, mariner, pilot, or the servants of the
carrier in the navigation or in the management of the shipE
(b) 2ire, unless caused by the actual fault or privity of the carrierE
(d) Act of odE
(e) Act of war,
(f) Act of public enemiesE
(g) Arrest or restraint of princes, rulers, or people, or sei8ure under legal
processE
(h) Wuarantine restrictionsE
(i) Act or omission of the shipper or owner of the goods, his agent or
(#) !tri9es or loc9outs or stoppage or restraint of labor from whatever cause,
whether partial or generalE Provided, 1hat nothing herein contained shall be
construed to relieve a carrier from responsibility for the carrierMs own actsE
(9) Riots and civil commotions
(l) !aving or attempting to save life or property at seaE
(m) astage in bul9 or weight or any other loss or damage arising from inherent
defect, Cuality, or vice of the goodsE
(n) nsufficiency of pac9ingE
(o) nsufficiency of inadeCuacy of mar9sE
(p) +atent defects not discoverable by due diligenceE and
(C) Any other cause arising without the actual fault and privity of the carrier and
burden of proof shall be on the person claiming the benefit of this exception
to show that neither the actual fault or privity of the carrier nor the fault or
neglect of the agents or servants of the carrier contributed to the loss or
damage.
?  of ,- 
(0) 1he shipper shall not be responsible for loss or damage sustained by the carrier
or the ship arising from any cause without the act, fault, or neglect of the shipper, his
agents, or servants.
(?) Any deviation in saving or attempting to save life or property at sea, or any
reasonable deviation shall not be deemed to be an infringement or breach of this Act
or of the contract of carriage, and the carrier shall not be liable for any loss or
damage resulting therefrom: Provided, however, 1hat if the deviation is for the
purpose of loading cargo or unloading cargo or passengers it shall, prima facie, be
regarded as unreasonable.
(4) /either the carrier nor the ship shall in any event be or become liable for any loss
or damage to or in connection with t he transportation of goods in an amount
exceeding V4@@ per pac9age lawful money of the 'nited !tates, or in case of goods
not shipped in pac9ages, per customary freight unit, or the eCuivalent of that sum in
other currency, unless the nature and value of such goods have been declared by the
shipper before shipment and inserted in the bill of lading. 1his declaration, if
embodied in the bill of lading, shall be prima facie evidence, but shall not be
conclusive on the carrier.
"y agreement between the carrier, master, or agent of the carrier, and the shipper
another maximum amount than that mentioned in this paragraph may be fixed:
Provided, that such maximum shall not be less than the figure above named. n no
event shall the carrier be liable for more than the amount of damage actually
sustained.
/either the carrier nor the ship shall be responsible in any event for loss or damage
to or in connection with the transportation of the goods if the nature or value thereof
has been 9nowingly and fraudulently misstated by the shipper in the bill of lading.
(>) oods of an inflammable, explosive, or dangerous nature to the shipment
whereof, the carrier, master or agent of the carrier, has not consented with
9nowledge of their nature and character, may at any time before discharge
be landed at any place or destroyed or rendered innocuous by the carrier
without compensation, and the shipper of such goods shall be liable for all
damages and expenses directly or indirectly arising out of or resulting from
such shipment. f any such goods shipped with such 9nowledge and consent
shall become a danger to the ship or cargo, they may in li9e manner be
landed at any place, or destroyed or rendered innocuous by the carrier
without liability on the part of the carrier except to general average, if any.
!'RR&/B&R 2 R;1! A/B %%'/1&! A/B /R&A!& 2 R&!P/!"+1&!
 A/B +A"+1&!
!ection 4. A carrier shall be at liberty to surrender in whole or in part all or any of his
rights and immunities or to increase any of his responsibilities and liabilities under
this Act, provided such surrender or increase shall be embodied in the bill of lading
issued to the shipper.
1he provisions of this Act shall not be applicable to charter partiesE but if bills of
lading are issued in the case of a ship under charter party, they shall comply with the
terms of this Act. /othing in this Act shall be held to prevent the insertion in a bill of
lading of any lawful provision regarding general average.
!P&A+ /B1/!
!ection >. /otwithstanding the provisions of the preceding section, a carrier, master
or agent of the carrier, and a shipper shall, in regard to any particular goods be at
liberty to enter into any agreement in any terms as to the responsibility and liability
of the carrier for such goods, and as to the rights and immunities of the carrier in
respect of such goods, or his obligation as to seaworthiness (so far as the
stipulation regarding seaworthiness is not contrary to public policy), or the care or
diligence of his servants or agents in regard to the loading, handling stowage,
carriage, custody, care, and discharge of the goods carried by sea: Provided, 1hat in
this case no bill of lading has been or shall be issued and t hat the terms agreed shall
be embodied in a receipt which shall be a non6negotiable document and shall be
mar9ed as such.
 Any agreement so entered into shall have full legal effect: Provided, 1hat this section
shall not apply to ordinary commercial shipments made in the ordinary course of
trade but only to other shipments where the character or condition of the property
to be carried or the circumstances, terms, and conditions under which the carriage
is to be performed are such as reasonably to #ustify a special agreement.
!ection -. /othing contained in this Act shall prevent a carrier or a shipper from
entering into any agreement, stipulation, condition, reservation, or exemption as to
the responsibility and liability of the carrier or the ship for the loss or damage to or
in connection with the custody and care and handling of goods prior to the loading on
and subseCuent to the discharge from the ship on which the goods are carried by
sea.
!ection 7. 1he provisions of this Act shall not affect the rights and obligations of the
carrier under the provisions of the !hipping Act, 3>, or under the provisions of
!ection ?57 to ?573, inclusive, of the Revised !tatutes of the 'nited !tates, or of
any amendments theretoE or under the provisions of any other enactment for the
time being in force relating to the limitation of the liability of the owners of seagoing
vessels.
!ection 3. /othing contained in this Act shall be construed as permitting a common
carrier by water to discriminate between competing shippers similarly place in time
and circumstances, either (a) with respect to the right to demand and receive bills
of lading sub#ect to the provisions of this ActE or (b) when issuing such bills of lading,
either in the surrender of any of the carrierMs rights and immunities or in the increase
of any of the carrierMs responsibilities and liabilities pursuant to section >, title , of
this Act or (c) in any other way prohibited by the !hipping Act, 3>, s amended.
!ection @. (/ot applicable to the Philippines.).
!ection . here under the customs of any trade the weight of any bul9 cargo
inserted in the bill of lading is a weight ascertained or accepted by a third party
other than the carrier or the shipper, and the fact that the weight is so ascertained
or accepted is stated in the bill of lading, then, notwithstanding anything in this Act,
the bill of lading shall not be deemed to be prima facie evidence against the carrier of 
the receipt of goods of the weight so inserted in the bill of lading, and the accuracy
thereof at the time of shipment shall not be deemed to have been guaranteed by the
shipper.
  of ,- 
 draft to Gau Gue because the
!ection 5. (/ot applicable to the Philippines.). which indorsed it to same had
 Ang. "ut despite perished,
!ection 0. 1his Act shall apply to all contracts for carriage of goods by sea to or 1evesD non6payment, gone out of
from ports of the 'nited !tates in foreign trade. As used in this Act the term N'nited he was able to get commerce,
!tatesN includes its districts, territories, and possessions: Provided, however, that the the goods released to or
Philippine legislature may by law exclude its application to transportation to or from him by American disappeared
ports of the Philippine slands. 1he term Nforeign tradeN means the transportation of !teamship (carrierDs that their
goods between the ports of the 'nited !tates and ports of foreign countries. /othing agent). Ang filed an existence is
in this Act shall be held to apply to contracts for carriage of goods by sea between action to claim the un9nown or
any port of the 'nited !tates or its possessions, and any other port of the 'nited goods. American they cannot
!tates or its possession: Provided, however, 1hat any bill of lading or similar !teamship contends be
document of title which is evidence of a contract for the carriage of goods by sea that AngDs action has recovered.
between such ports, containing an express statement that it shall be sub#ect to the prescribed under 1he
provisions of this Act, shall be sub#ected hereto as fully as if sub#ect hereto as fully as !A. applicable
if sub#ect hereto by the express provisions of this Act: Provided, further, 1hat every rule on
bill of lading or similar document of title which is evidence of a contract for the prescription
carriage of goods by sea from ports of the 'nited !tates, in foreign trade, shall is found in
contain a statement that it shall have effect sub#ect to the provisions of this Act. the ivil
!ection ?. 'pon the certification of the !ecretary of ommerce that the foreign ode, either:
commerce of the 'nited !tates in its competition with that of foreign nations is @ years for
pre#udiced the provisions, or any of them, of 1itle  of this Act, or by the laws of any breach of
foreign country or countries relating to the carriage of goods by sea, the President of contract or ?
the 'nited !tates, may, from time to time, by proclamation, suspend any or all years for
provisions of 1itle  of this Act for such periods of time or indefinitely as may be Cuasi6delict.
designated in the proclamation. 1he President may at any time rescind such 2.;. !tevens shipped hile f, in an action
suspension of 1itle  hereof, and any provisions thereof which may have been !tevens v. aboard !tevenDs commenced, in due
suspended shall thereby be reinstated and again apply to contracts thereafter made /ordeutsc /orddeuscherDs action was time, a #udgment
for the carriage of goods by sea. Any proclamation of suspension or rescission of any her vessel, thermometers dismissed for the plaintiff be
such suspension shall ta9e effect on a date named therein, which date shall be not that were delivered over 5@ days reversed, or if the
less than ten days from the issue of the proclamation. missing and after the plaintiff fail
 Any contract for the carriage of goods by sea, sub#ect to the provisions of this Act, destroyed. expiration of otherwise than
effective during any period when title  hereof, or any part thereof, is suspended, /orddeuscher refused the period of  upon the merits,
shall be sub#ect to all provisions of law now or hereafter applicable to that part of to pay despite  year within and the time limited
1itle  which may have thus been suspended. !tevenDs demands which his for the
and contended that action could commencement of
A!& 2A1! ;&+B$RA1 B1R/& +A!! !tevenDs cause of be brought such action has, at
/1&! action had prescribed. pursuant to the date of such
 Ang v.  Gau Gue sold to 1eves  AngDs action !A, !ec 0 (>), A >4, in reversal or failure,
 American galvani8ed sheets has not yet par. ?, which relation to expired, the
!teamship which were covered prescribed. provides for  yr the !A, plaintiff, or, if he
 Agencies by 1evesD ban9 draft  I+ossJ prescriptive period under Act die and the cause
in exchange for the contemplates for bringing an /o. 3@ of action survive,
 Gau GueDs bill of a situation action for Iloss or provides that his representatives
lading to be where no damageJ is the period may commence a
deposited in ;!". delivery at all inapplicable where within which new action within 
1eves failed to pay so was made by there is no such !tevens year after such
;!" returnedthe bill the shipper loss but delivery to could initiate date, and this
of lading and demand of the goods the wrong person. the present provision shall apply

  of ,- 
 case was to any claim  5. 1he carriage by air within the meaning of the preceding paragraph
renewed, for asserted in any comprises the "erio( (urin) 2ic !e #a))a)e or car)o is in car)e
another year. pleading by a o0 !e carrier, whether in an aerodrome or on board an aircraft, or, in the
defendant (Act /o. case of a landing outside an aerodrome, in any place whatsoever.
3@, !ec. ?3)  0. 1he period of the carriage by air does not extend to any carriage by land,
by sea or by river performed outside an aerodrome. f, however, such a
 (Roe Anuncio)  carriage ta9es place in the performance of a contract for carriage by air, for
 V. AIR TRANSPORTATION the purpose of loading, delivery or trans6shipment, any damage is
C. In!erna!ional Air Trans"or!a!ion presumed, sub#ect to proof to the contrary, to have been the result of an
,. Cons!i!u!ionali!$ event which too9 place during the carriage by air.

A!& 2A1! ;&+B$RA1 B1R/& +A!!  Article 3: 

11+& /1&!  1he carrier is liable for damage occasioned by (ela$ in the carriage by air of 
!antos !antos sued /A 1he case 1he onvention passengers, baggage or cargo.
v. before the %a9ati was properly en#oys the
/orthwe R1 for damages. dismissed. presumption of A!& 2A1! ;&+B$RA1 B1R/& +A!!
st 1he case was 1he constitutionality for 11+& /1&!
dismissed for lac9 constitutiona being an executive6 /orthwest uenca sued uenca may  Articles -63
of #urisdiction lity of the legislative act, which v. uenca /orthwest for sue provide for
based on Article 57 onvention presumption was not damages. /orthwest /orthwest grounds for which
of the onvention. was upheld. overcome by argues that Articles for breach of  an air carrier may
petitioner. -63 of the contract. be sued for
onvention are the damages, but the
4. Wen a""lica#le only grounds for same is not
which it may be exclusive. ther
Rele'an! "ro'ision: sued, to any of which forms of breach of 
the present case contract may be
AR!A /&/1/, Article (): does not fall. grounds for suit.
 1his onvention applies to all international carriage of persons, baggage or  Alitalia v. Pablo sued Alitalia for  Alitalia may  Articles -63
cargo performed by aircraft for reward. t applies eCually to gratuitous A an 6month delay in be held provide for
carriage by aircraft performed by an air transport underta9ing. the carriage of his liable. grounds for which
baggage. Alitalia puts an air carrier may
. Lia#ili!ies un(er !e Con'en!ion forth the same as be sued for
/orthwest in the damages, but the
Rele'an! "ro'isions: previous case. same is not
exclusive. ther
AR!A /&/1/, Article -: forms of breach of 
 1he carrier is liable for damage sustained in the event of the (ea! or contract may be
2oun(in) o0 a "assen)er or an$ o!er #o(il$ in7ur$  suffered by a grounds for suit.
passenger, if the accident which caused the damage so sustained too9 place
on #oar( !e aircra0! or in !e course o0 an$ o0 !e o"era!ions o0 >. Li/i!a!ions on Lia#ili!$
e/#ar9in) or (ise/#ar9in) .
Rele'an! "ro'ision:
 Article 7: 
 . 1he carrier is liable for damages sustained in the event of the AR!A /&/1/, Article 55: 
(es!ruc!ion or loss o08 or o0 (a/a)e !o8 an$ re)is!ere( #a))a)e or  . n the carriage of persons the liability of the carrier for eac "assen)er
an$ car)o, if the occurrence which caused the damage so sustained too9  is li/i!e( !o !e su/ o0 !2o un(re( an( 0i0!$ !ousan( 0rancs .
place (urin) !e carria)e by air. here, in accordance with the law of the court seised of the case, damages
may be awarded in the form of periodical payments, the eCuivalent capital
  of ,- 
 value of the said payments shall not exceed two hundred and fifty thousand liability of Pan Am his luggage and and payment of
francs. /evertheless, by special contract, !e carrier an( !e "assen)er to V5@ per 9ilo. paid additional additional
/a$ a)ree !o a i)er li/i! o0 lia#ili!$ . charges. charges.
 5. (a) n the carriage of re)is!ere( #a))a)e an( o0 car)o, the liability
of the carrier is li/i!e( !o a su/ o0 !2o un(re( an( 0i0!$ 0rancs "er . Wen Li/i!a!ions Una'aila#le
9ilo)ra//e, unless the passenger or consignor has made, at the time
when the pac9age was handed over to the carrier, a s"ecial (eclara!ion Rele'an! "ro'isions:
o0 in!eres! in (eli'er$ a! (es!ina!ion an( as "ai( a su""le/en!ar$
su/ if the case so reCuires. n that case the carrier will be liable to pay a AR!A /&/1/, Article 0:
sum not exceeding the declared sum, unless he proves that the sum is  . n respect of the carriage of passengers a !ic9e!  shall be delivered
greater than the passengerMs or consignorMs actual interest in delivery at con!ainin):
destination. (a) an indication of the places of departure and destinationE
 (b) n the case of loss8 (a/a)e or (ela$   of part of registered (b) if the places of departure and destination are within the territory of a
baggage or cargo, or of any ob#ect contained therein, the weight to be ta9en single ;igh ontracting Party, one or more agreed stopping places being
into consideration in determining the amount to which the carrierMs liability is within the territory of another !tate, an indication of at least one such
limited shall be only the !o!al 2ei)! o0 !e "ac9a)e or "ac9a)es stopping placeE
concerne(. /evertheless, when the loss, damage or delay of a part of  (c) a no!ice  to the effect that, if the passengerMs #ourney involves an
the registered baggage or cargo, or of an ob#ect contained therein, affects ultimate destination or stop in a country other than the country of 
the value of other pac9ages covered by the same baggage chec9 or the departure, the arsaw onvention may be applicable and that !e
same air waybill, the total weight of such pac9age or pac9ages shall also be Con'en!ion )o'erns an( in /os! cases li/i!s !e lia#ili!$
ta9en into consideration in determining the limit of liability. o0 carriers 0or (ea! or "ersonal in7ur$ an( in res"ec! o0 loss o0 or
 0. As regards o#7ec!s o0 2ic !e "assen)er !a9es car)e i/sel0  (a/a)e !o #a))a)e.
the liability of the carrier is li/i!e( !o 0i'e !ousan( 0rancs "er  5. 1he passenger tic9et shall constitute prima facie evidence of the
"assen)er. conclusion and conditions of the contract of carriage. 1he absence,
 ?. 1he limits prescribed in this Article shall not prevent the court from irregularity or loss of the passenger tic9et does not affect the existence or
awarding, in accordance with its own law, in a((i!ion8 !e 2ole or "ar! the validity of the contract of carriage which shall, none the less, be sub#ect
o0 !e cour! cos!s an( o0 !e o!er e<"enses o0 !e li!i)a!ion to the rules of this onvention. /evertheless, if, with the consent of 
incurred by the plaintiff. 1he foregoing provision shall not apply if the the carrier, the passenger embar9s without a passenger tic9et having been
amount of the damages awarded, excluding court costs and other expenses delivered, or if the !ic9e! (oes no! inclu(e !e no!ice re&uire( #$
of litigation, does not exceed the sum which the carrier has offered in "ara)ra" ,5c6 o0 !is Ar!icle8 !e carrier sall no! #e en!i!le( !o
writing to the plaintiff within a period of six months from the date of the a'ail i/sel0 o0 !e "ro'isions o0 Ar!icle 44 .
occurrence causing the damage, or before the commencement of the action,
if that is later.  Article 54: 
 4. 1he sums mentioned in francs in this Article shall be deemed to refer to a  1he limits of liability specified in  Ar!icle 44 sall no! a""l$  if it is proved
currency unit consisting of sixty6five and a half milligrammes of gold of  that the damage resulted from an ac! or o/ission o0 !e carrier 8 is
millesimal fineness nine hundred. 1hese sums may be converted into ser'an!s or a)en!s, done with in!en! !o cause (a/a)e or rec9lessl$
national currencies in round figures. onversion of the sums into national an( 2i! 9no2le()e !a! (a/a)e 2oul( "ro#a#l$ resul! E provided
currencies other than gold shall, in case of #udicial proceedings, be made that, in the case of such act or omission of a servant or agent, it is also
according to the gold value of such currencies at the date of the #udgment. proved that he was acting 2i!in !e sco"e o0 is e/"lo$/en!.
 Article 54A: 
A!& 2A1! ;&+B$RA1 B1R/& +A!!  . f an action is brought against a servant or agent of the carrier arising
11+& /1&! out of damage to which this onvention relates, such ser'an! or a)en! , if 
Pan Pan Am was sued 1he stipulation Parties may he proves that he acted within the scope of his employment, shall be
 Am v. for the delay in the limiting Pan AmDs stipulate a limit entitled to a'ail i/sel0 o0 !e li/i!s o0 lia#ili!$   which
A delivery of liability is valid on the air that carrier himself is entitled to invo9e under Article 55.
PanganDs luggage. and binding upon carrierDs liability  5. 1he aggregate of the amounts recoverable from the carrier, his servants
 A stipulation in the Pangan, since he sub#ect to the and agents, in that case, shall not exceed the said limits.
tic9et provides for a did not declare a declaration of a  0. 1he provisions of "ara)ra"s , an( 4 o0 !is Ar!icle sall no! a""l$
limitation in the higher value for higher value if it is proved that the damage resulted from an act or omission of the

,--  of ,- 
 servant or agent done 2i! in!en! to cause damage or rec9lessly and 2i! destination, or from the date on which the aircraft ought to have arrived, or
9no2le()e that damage would probably result. from the date on which the carriage stopped.
 5. 1he method of calculating the period of limitation shall be determined by
A!& 2A1! ;&+B$RA1 B1R/& +A!! the law of the ourt seised of the case.
11+& /1&!
1A v.  inluan sued nattention and 1he limitations on A!& 2A1! ;&+B$RA1 B1R/& +A!!
A 1A for lac9 of due care the liability of the 11+& /1&!
damages for not for the carrier do not !antos v. !antos sued /A 1he case was 1he enumeration of 
having availed passengersD apply when the /orthwest before the %a9ati properly the courts before
of a first class interest carrier acted R1 for damages. dismissed for which suits for
seat despite a attended the rec9lessly or with 1he case was lac9 of damages may be
confirmed acts of 1A. 9nowledge that dismissed for lac9   #urisdiction filed is not
reservation. 1A is liable for damage will of #urisdiction based on the arbitrary, but is
damages. probably result. based on Article onvention. founded on
57 of the convenience.
?. Con(i!ions on I/"osi!ion o0 Lia#ili!$ onvention.
+una v. +una sued 2ailure to file a 1he onvention
Rele'an! "ro'isions: A /orthwest for complaint with does not provide
damages due to /orthwest the absolute limit
AR!A /&/1/, Article 5>: the delay in the pursuant to the to the carrierDs
 . Recei"! by the person entitled to delivery of   baggage or cargo 2i!ou! delivery of their onvention liability. iolations
co/"lain! is "ri/a 0acie e'i(ence  that the same has been delivered in baggage. does not result through a breach of 
good condition and in accordance with the document of carriage. /orthwest argues in the summary contract may be
 5. n the case of damage, the person entitled to delivery must co/"lain to that the suit dismissal of the redressed by
the carrier forthwith after the discovery of the damage, and, at the latest, cannot prosper suit. +una may invo9ing other
2i!in se'en (a$s 0ro/ !e (a!e o0 recei"! in !e case for failure to file a invo9e the ivil laws, such as the
o0 #a))a)e an( 0our!een (a$s 0ro/ !e (a!e o0 recei"! in !e case complaint with it ode. ivil ode.
o0 car)o. n the case of (ela$ the complaint must be made at the latest within the 56day
2i!in !2en!$=one (a$s  from the date on which the baggage or cargo reglementary
have been placed at his disposal. period as
 0. &very co/"lain! /us! #e /a(e in 2ri!in)  upon the document of  mandated by the
carriage or by separate notice in writing despatched within the times onvention.
aforesaid. +huillier +huillier sued 1he case should 1he enumeration in
 ?. ;ailin) co/"lain! within the times aforesaid, no ac!ion sall lie v. "ritish "ritish Airways for be dismissed.  Article 57 is a
a)ains! !e carrier 8 sa'e in !e case o0 0rau( on his part.  Airways damages before  Article 57 of the  #urisdiction, not a
the %a9ati R1 onvention venue, provision.
 Article 57:  for being rudely provides for the 2ailure to comply
 . An ac!ion 0or (a/a)es  must be brought, at the option of the plaintiff, treated. "ritish courts before with the same
in the !erri!or$ o0 one o0 !e Hi) Con!rac!in) Par!ies, either before  Airways caused which action results in the
the ourt having #urisdiction where the carrier is ordinarily resident, or has the dismissal of damages may dismissal of the
his principal place of business, or has an establishment by which the the action on lac9  be filed. action.
contract has been made or before the ourt having #urisdiction at the place of #urisdiction.
of destination. PA+ v. omplainant sued 1he suit may 1he 56year
 5. Wuestions of procedure shall be governed by the law of the ourt seised !avillo PA+ for damages still prosper prescriptive period
of the case. arising from the because not all will only operate
delay in the causes of provided that the
 Article 53:  transporting them action of the action is solely
 . 1he ri)! !o (a/a)es sall #e e<!in)uise(   if an action is no! to their complainant are governed by the
#rou)! 2i!in !2o $ears , rec9oned from the date of arrival at the destination, which governed by the onvention.
,-, of ,- 
 caused him other onvention. 1he
in#uries. PA+ other in#uries LIABILITY O; THE AIR CARRIER UNDER THE WARSAW CONVENTION o0 
alleges that the are governed by Oc!. ,48 ,4
cause of action the ivil ode.
has already  Art. -. 1he carrier shall be liable for damages sustained in the event of death or
prescribed (5 yrs wounding of a passenger or any other bodily in#ury suffered by a passenger, if the
according to the accident which caused the damage so sustained too9 place on board the aircraft or in
onvention). the course of any of the operations of embar9ing or disembar9ing.
'nited 'y sued 'A for 1he suit may  An action for
 Airlines v. damages arising prosper because damages may still  Art. 7 () 1he carrier shall be liable for damage sustained in the event of the
'y from ill treatment although one of be pursued despite destruction or loss of, or of damage to, any chec9ed baggage, or any goods, if the
and loss of his the causes of the lapse of the 56 occurrence which caused the damage so sustained too9 place during the
belongings. 'A action (loss of year prescriptive transportation by air.
argues that the belongings) has period under the
suit is already already onvention, (5) 1he transportation by air within the meaning of the preceding paragraph
barred by prescribed, the provided that the shall comprise the period during which the baggage or goods are in the charge of the
prescription, not other (ill same is governed carrier, whether in an airport or on board an aircraft, or, in case of a landing outside
having been filed treatment) has by other laws such an airport, in any place whatsoever.
within the 56year not as the latter as the ivil ode.
period. is governed by (0) 1he period of the transportation by air shall not extend to any
the ivil ode transportation by land, by sea, or by river performed outside an airport. , however,
and not the such transportation ta9es place in the performance of a contract for transportation by
onvention. air, for the purpose of loading, delivery, or transshipment, any damage is presumed,
sub#ect to proof to the contrary, to have been the result of an event which too9 place
(Robert "elte#ar)  during the transportation by air.
 A)#a$ani Anno!a!ion:
 Art. 3. 1he carrier shall be liable for damage occasioned by delay in the
>a Air carrier can !er/ina!e ser'ices o0 "ilo! 0or serious /iscon(uc! an( transportation by air of passengers, baggage or goods.
(run9enness8 #ecause o0 i!s (u!$ o0 e<!raor(inar$ (ili)ence
P&R1/&/1 A!&: /orthwest Airlines nc. v. uenca
- here PA+ pilot (a captain) ordered 5 subordinates to drin9 > bottles of beer - PetitionerDs Argument: "ased on the provisions of the arsaw onvention,
each w$in 0@ minutes at @:0@ pm, they being scheduled to fly the following an air carrier is liable only in the event of a passengerDs death or in#ury
morning at -:0@ am, and when they failed to do so, boxed them in the suffered by him, or of destruction or loss of, or damage to any chec9ed
stomach, and further where he was also charged with violation of the baggage or any goods, or of delay in the transport by air of passengers,
company liCuor ban, the ourt found him guilty of serious misconduct and baggage, or goods.
violation of the liCuor ban, and granted the application of PA+ for authority - !: 1he petitionerDs contention is not supported by the language of the
to terminate the services of the pilot, instead of merely a six months arsaw onventionDs articlesE they merely declare the carrier liable for
demotion as held by the /ational +abor Relations "oard. 1he ourt #ustified damages in the enumerated cases 2 the conditions specified therein are
its decision as follows: 1he business of PA+ is such that whenever a present.
passenger dies or is in#ured the presumption is it is at fault notwithstanding o /either said provisions nor others in the arsaw onvention
the fact that it has exercised due diligence of a good father of a family in the regulate or exclude liability for other breaches of contract by the
selection and supervision of its employees. 1hus, extraordinary measures carrier.
and diligence should be exercised by it for the safety of its passengers and o PetitionerDs theory that an air carrier would be exempt from any
their belonging. /eedless to state, a pilot must be sober all the time for he liability for damages in the event of its absolute refusal in bad faith
may be called upon to fly a plane even before his regular scheduled hours, to comply with a contract of carriage is absurd.
otherwise so many lives will be in danger if he is drun9. t would be un#ust
for an employer li9e petitioner PA+ to be compelled to continue with the ETENT O; LIABILITY O; AIR CARRIER ;OR DEATH O; PASSENGER 
employment of a person whose continuance in the service is obviously
inimical to its interests. P&R1/&/1 A!&: Bavila v. PA+ (3-4)

,-4  of ,- 

Wuic9 2acts: B, <r. was one of the passengers of PA+. 1he plane crashed, and all
crew members and passengers were 9illed. 1he pilot did not follow the route
prescribed for his flight (between Romblon and %anila). !uch failure to follow the
route was concluded to be intentional (he probably wanted to fly on a straight line to
%anila). t was a violation of air6traffic rules to which the accident may be
attributable. 1he parents of B, <r. filed a complaint against PA+ for damages.
Ruling: PA+ liable even if the cause of death was an accident because there was no
satisfactory explanation on the part of PA+ as to how and why the accident occurred.
1he presumption is that PA+ was at fault, under ivil ode Art. -4>.
PA+Ds liability for lost earnings of the deceased passenger are his net earnings during
his expected length of life based on accepted mortality tables. PA+ is not liable for
exemplary damages since, according to ivil ode Art. 5005, in contracts and Cuasi6
contracts, the court may award exemplary damages if the defendant acted in a
wanton, fraudulent, rec9less, oppressive or malevolent manner. 1he failure of PA+ to
exercise extraordinary diligence does not amount to anyone of the circumstances
under Art. 5005.
PROVISION IN THE PASSAGE TIC3ET THAT CARRIAGE BY SUCCESSIVE AIR  respondents read them before they accepted their passage tic9ets.
CARRIERS IS TO BE REGARDED AS A SINGLE OPERATION IS TO *A3E
TIC3ET=ISSUING CARRIER LIABLE ;OR TORTUOUS CONDUCT O; OTHER   As regards the nature of the carriage involved in this case, it is to be considered as a
CARRIERS
P&R1/&/1 A!&: F+% Royal Butch Airlines v. A
R%, his wife and their daughter and niece were issued F+% tic9ets for a trip abroad
including a trip to +ourdes, 2rance. ;owever, their coupon for the Aer +ingus portion
was mar9ed RW (on reCuest). n ermany, they went to a F+% office and obtained
confirmation from Aer +ingus of seat reservations on flight 7>.
Respondents then went to the "arcelona Airport. 1he manager of Aer +ingus directed
them to chec9 in, and they were accepted for passage. ;owever, subseCuently, they
were off6loaded on orders of Aer +ingus manager who shoved them aside and
shouted invectives at them. 1hey then merely loo9 a train to +ourdes. After they got
bac9 to the Philippines, they filed a case against F+%.
F+% sought to evade liability by saying that the air tic9ets issued to respondents
stipulate the carriage is sub#ect to the arsaw onvention to which the Philippine
ovDt is a party by adherence and which provides that Ithe passenger or his
representative can ta9e action only against the carrier who performed the
transportation during which the accident or the delay occurred, save in the case
where, by express agreement, the first carrier assumed liability for the whole
 #ourney.J
F+% also reasoned that on the inside front cover of each tic9et, under the onditions
of ontract, it is stated that the liability of the carrier for damages shall be limited to
occurrences on its own line, except in case of chec9ed baggage as to which the
passenger also has a right of action against the first or last carrier. A carrier issuing a
tic9et or chec9ing baggage for carriage over the lines of other does so only as agent.
! R'+/: Art. 0@ of the arsaw onvention which F+% used to escape liability
(limiting the action to the carrier which undertoo9 the transportation) and which F+%
cited above is not applicable because it presupposes the occurrence of either an
accident or a delay, neither of which too9 place at the "arcelona airport. hat
happened here instead was that Aer +ingus via its manager, refused to transport the
respondents to their contracted destination.
1he provision limiting liability of the carrier to occurrences on its line is not applicable
since the respondents are not bound by the provisions. 1hat condition was printed in
letter so small that one would have to use a magnifying glass to read the words. t
would be unfair and ineCuitable to charge the respondents with automatic 9nowledge
or notice of the said condition as to preclude any doubt that it was fairly and freely
agreed upon by the respondents when they accepted the passage tic9ets issued to
them by F+%. As the airline which issued those tic9ets with the 9nowledge that the
respondents would be flown on the various legs of their #ourney by different air
carriers, the F+% was chargeable with the duty of specifically informing the
respondents of conditions prescribed in their tic9ets or at least to ascertain that the
single operation. 1he respondents dealt exclusively with F+% which issued them
tic9ets for their entire trip and which in effect guaranteed to them that they would
have sure space in Aer +ingus flight 7>. 1he respondents under assurance of F+%
naturally had the right to expect that their tic9ets would be honored by Aer +ingus to
which the F+% had indorsed and in effect guaranteed the performance of its principal
engagement to carry out the respondentsD scheduled itinerary previously and
mutually agreed upon by the parties.
 AIR TRANSPORTATION IS CO**ERCIAL
=  A contract of transportation by air may be regarded as commercial. Air
transportation is clearly similar or analogous to land and water transportation. 1he
obvious reason for its non6inclusion in the ode of ommerce was that at the time of 
its promulgation, transportation by air on a commercial basis was not yet 9nown. n
the '.!. where air transportation has reached its highest development, an airline
company engaged in the transportation business is regarded as a common carrier.
(Roe Anuncio) 
B. Passen)er Ri)!s
Rele'an! la2:
<oint B16B1 A.. /o. @, !eries of 5@5: 
!ection . Ti!le o0 Re)ula!ion. 1his Regulation shall be 9nown and cited as the IAir 
Passenger "ill of RightsJ.
,-:  of ,- 
!ection 0. Sco"e. 1his Regulation shall apply to all aspects of contracts of carriage
for flights or portions of a flight into, from, and within the territory of the Philippines
operated by Philippine air carriers, and flights or portions of a flight from the territory
of the Philippines operated by foreign air carriers. Provided, that the compensation
rules shall not apply to carriers flying into the territory of the Philippines, if the laws
of the country of origin provide similar or higher compensation. therwise, these
rules shall apply in full.
!ection ?. Ri)! !o ;ull8 ;air8 an( Clear Disclosure o0 !e Ser'ice O00ere( an(  .
 All !e Ter/s an( Con(i!ions o0 !e Con!rac! o0 Carria)e. &very passenger
shall, before purchasing any tic9et for a contract of carriage by the air carrier or its
agents, be entitled to the full, fair, and clear disclosure of all the terms and conditions
of the contract of carriage about to be purchased. 1he disclosure shall include,
among others, documents reCuired to be presented at chec96in, provisions on chec96
in deadlines, refund and reboo9ing policies, and procedures and responsibility for
delayed and$or cancelled flights. 1hese terms and conditions may include liability
limitations, claim6filing deadlines, and other crucial conditions.
o ?. An air carrier shall cause the disclosure under this !ection to be printed
on or attached to the passenger tic9et and$or boarding pass, or the
incorporation of such terms and conditions of carriage by reference.
ncorporation by reference means that the tic9et and$or boarding pass shall
clearly state that the complete terms and conditions of carriage are available
for perusal and$or review on the air carrierDs website, or in some other
document that may be sent to or delivered by post or electronic mail to the
passenger upon his$her reCuest.
o ?.5 1he air carrier must also ensure that passengers receive an explanation
of 9ey terms identified on the tic9et from any location where the carrierDs
tic9ets are sold, including travel agencies. n case of online boo9ings, the air
carrier must establish a system wherein the purchaser is fully apprised of
the reCuired disclosures under this !ection twice prior to the final submission
of his$her online offer to purchase.
o ?.0 Aside from the printing and$or publication of the above disclosures, the
same shall li9ewise be verbally explained to the passenger by the air carrier
and$or its agent$s in &nglish and 2ilipino, or in a language that is easily
understood by the purchaser, placing emphasis on the limitations and$or
restrictions attached to the tic9et.
o ?.? 1he 9ey terms of a contract of carriage, which should include, among
others, the reboo9ing, refunding, baggage allowance and chec96in policies,
must be provided to a passenger and shall substantially be stated in the
following manner and, if done in print, must be in bold letters:
(&nglish)
 I/1&:
1he tic9et that you are purchasing is sub#ect to the following
conditions$restrictions:
. [[[[[[[[[[[[[[[  (#)
5. [[[[[[[[[[[[[[[  Provided, further, that, where there are differing conditions, such as fuel
0. [[[[[[[[[[[[[[[  surcharge in relation to the points of destinations or origin, the
 Gour purchase of this tic9et becomes a binding contract on your part to
follow the terms and conditions of the tic9et and of the f light. Bepending on
the fare rules applicable to your tic9et, non6use of the same may result in
forfeiture of the fare or may sub#ect you to the payment of penalties and
additional charges if you wish to change or cancel your boo9ing.
2or more choices and$or control in your flight plans, please consider other
fare types.J 
(2ilipino)
 IPAA+A+A:
 Ang ti9et na ito ay binibili ninyo nang may mga 9ondisyon$ restri9syon:
[[[[[[[[[[[[[[[[ 
5. [[[[[[[[[[[[[[[[ 
0. [[[[[[[[[[[[[[[[ 
!a pagpili at pagbili ng ti9et na ito, 9ayo ay sumasang6ayon sa mga
9ondisyon at restri9syon na na9ala9ip dito, bilang 9ontrata ninyo sa air
carrier. Bepende sa pata9arang ang9op sa iyong ti9et, ang hindi paggamit
nito ay maaaring magresulta sa pagwawalang bisa sa inyong ti9et o sa
paniningil ng 9aragdagang bayad 9ung nais ninyong baguhin o 9anselahin
ang inyong ti9et.
Para sa mas maraming pagpipilian at malawa9 na control sa inyong flight,
inaanyayahan 9ayong bumili ng iba pang 9lase ng ti9et galing sa air carrier.J 
o ?.4 Any violation of the afore6stated provisions shall be a ground for the
denial of subseCuent applications for approval of promotional fare, or for the
suspension or recall of the approval made on the advertised fare$rate.
!ection 4. Ri)! !o Clear an( Non=*islea(in) A('er!ise/en!s o08 an(
I/"or!an! Re/in(ers Re)ar(in) ;ares. A('er!ise/en!s o0 0ares sall 
#e clear an( no! /islea(in).
o 4. %a#or restrictions, such as those on reboo9ability or refundability, which
may be attached to certain fare types, shall be disclosed in full and in such a
way that the passenger may fully understand the conseCuences of 
purchasing such tic9ets and the effect of non6use thereof.
o 4.5 &very air carrier causing the publication of fare advertisements in any
medium, shall li9ewise disclose the following:
(a) onditions and restrictions attached to the fare typeE
(b) Refund and reboo9ing policies, if anyE
(c) "aggage allowance policiesE
(d) overnment taxes and fuel surchargesE
(e) ther mandatory fees and chargesE
(f) ontact details of the carrier (i.e. phone number, website, e6mail, etc.)E
and
(g) ther information necessary to apprise the passenger of the conditions
and the full$total price of the tic9et purchased.
Provided, that, in case of promotional fares, the additional information shall
be included:
(h) /umber of seats offered on a per sector basisE
(i) 1he duration of the promoE and
1he A" Approval /o. of 2ares.
advertisements of these carriers may provide only the range thereof and not
the actual surcharge of each route.
,->  of ,- 
 4.0 1he above6mentioned reCuired disclosures shall occupy not less than
one6third ($0) of the advertising material. A copy of the same shall be
printed on or attached to the tic9et in &nglish and 2ilipino.
n the case of broadcast media, it shall be enough that the air carrier and$or
advertising agent incorporate the foregoing terms and conditions by
reference, as provided for in !ection ?..
!ection > . Ri)! A)ains! *islea(in) an( ;rau(ulen! Sales Pro/o!ion  o
Prac!ices. onsistent with the declared policy of the !tate to protect the interests of  designated by the B1 shall open a separate dedicated counter for a flight
the consumers, which includes protection from misleading and fraudulent sales
promotion practices, all sales promotion campaigns and activities of air carriers shall
be carried out with honesty, transparency and fairness, and in accordance with the
reCuirements of the onsumer Act of the Philippines, and its mplementing Rules and
Regulations.
 Air carriers shall provide to B1 a copy of its promotional materials for post audit not
later than the publication, release, or launch date whichever is earlier.
t is understood that professional authorities for those engaged in advertising, sales
and promotion may impose additional standards or measures to regulate their
industry.
!ection -. Ri)! !o Trans"or!a!ion an( Ba))a)e Con'e$ance. &very passenger
is entitled to transportation, baggage conveyance and ancillary services, in
accordance with the terms and conditions of contract of carriage with the air carrier.
1hus, any violation of the terms and conditions of the contract of carriage due to the
fault or negligence of the air carrier shall entitle the passenger to compensation or
alternative arrangements, as provided in this Air Passenger "ill of Rights, which are
acceptable to the passenger.
!ection 7. Ri)! !o #e Processe( 0or Cec9=In. n accordance with the usual air
carrier procedures, a passenger holding a confirmed tic9et, whether promotional or
regular, with complete documentary reCuirements, and who has complied with the
chec96in procedures, shall be processed accordingly at the chec96in counter within
the chec96in deadline. 1he airline shall, therefore, and sub#ect to infrastructure
limitations, clearly designate the boundaries of its assigned chec96in area$s or
counter$s.
 A passenger within the air carrierDs cordoned or other designated chec96in area as
herein defined at least one () hour before the published &1B shall not be considered
late or a no6show, and shall not be denied chec96in. 1he carrier shall exert utmost
diligence in ensuring that passengers within the cordoned or other designated chec96
in area and$or lined up at the chec96in counters are chec9ed in for their flights before
the chec96in deadline.
 A passenger who is late in accordance with the preceding paragraph may be denied
chec96in and directed to a standby or reboo9ing counter, as the case may be, for
proper processing.
 Any dispute under this !ection shall be resolved by the air carrier on6site. 2or this
purpose, the air carrier must present to the passenger proof, including, but not
limited to, closed6circuit television monitor recordings, processing or number slips
issued at the entrance of the chec96in area, and other applicable or available means,
that the latter failed t o appear within the prescribed time for the chec96in procedure.
!ection 3. Ri)! !o Su00icien! Processin) Ti/e. Passengers shall be given enough
time before the published &1B within which to go through the chec96in and final
security processes. 2or this purpose, air carriers operating in international airports
and in other airports designated by the B1 shall open their chec96in counters in
such airports at least two (5) hours before the &1B. n other airports, air carriers
shall open their chec96in counters at least one () hour before the &1B.
3. Air carriers operating in international airports and in other airports
nearing chec96in deadline to facilitate the chec9ing in of passengers at least
one () hour before the published &1B.
o 3.5 1o ensure that PBs and senior citi8ens shall have eCual access to air
transportation services, air carriers shall at all times and in all instances
adhere to the mandate of "atas Pambansa "lg. 0??, otherwise 9nown as An
 Act to &nhance the %obility of Bisabled Persons by ReCuiring ertain
"uildings, nstitutions, &stablishments and Public 'tilities to nstall 2acilities
and ther Bevices, the provisions of the &xpanded !enior iti8ens Act of 
5@@, and other related laws. Accordingly, an air carrier shall designate at
least one () chec96in counter which will prioriti8e PBs, senior citi8ens, and
persons reCuiring special assistance or handling. f this is not practicable,
the air carrier shall instead provide for priority handling and processing of 
such passengers. 1he air carrier shall li9ewise coordinate with the
appropriate authorities for the use of proper airport eCuipment, entryways,
and$or aerobridges, as the case may be, when the same are available, to
facilitate transactions, movement, boarding, and$or disembar9ation of 
PBs, senior citi8ens, and$or persons reCuiring special eCuipment, at the
airport.
o Persons accompanying a PB, a senior citi8en, or a person reCuiring special
assistance or handling should also be accommodated at the designated
chec96in counter mentioned in the preceding paragraph. t is the duty of an
air carrier or its authori8ed agent to inform its passengers if additional costs
will be incurred for the use of facilities designed for passengers needing
special assistance in airports located in other countries.
o t is the responsibility of a PB to declare his$her need for special
assistance or handling to the airline, upon boo9ing his$her flight. f the PB
fails to do so, the airline may not be held liable for any services it was not
able to provide the passenger and$or for any additional costs incurred for
the use of special assistance f acilities.
!ection @. Ri)! !o Boar( Aircra0! 0or !e Pur"ose o0 ;li)!. A passenger
chec9ed in for a particular flight has the right to board the aircraft for the purpose of 
flight, except when there is legal or other valid cause, such as, but not limited to,
immigration issues, safety and security, health concerns, non6appearance at the
boarding gate at the appointed boarding time, or government reCuisition of space as
provided for in !ection @.5. ther than these causes, no passenger may be denied
boarding without his$her consent.
o @. hile it is an accepted practice for an air carrier to overboo9 its flights,
any expense, conseCuence, or inconvenience caused to affected passengers
must be borne by the air carrier, as follows:
,-  of ,- 
 (a) 1he air carrier shall determine the number of passengers in excess of the
actual seat capacity of the aircraft.
(b) 1he air carrier shall announce that the flight is overboo9ed, and that it is
loo9ing for volunteers willing to give up their seats in exchange for air
carrier compensation.
(c) 1he air carrier shall provide the interested passengers or volunteers a list
of amenities and offers, which they can choose from, which list of amenities
shall always include the option to be given priority boo9ing in the next flight
with available space or to be endorsed to another air carrier upon payment
of any fare difference, and provided that space and other circumstances
permit such accommodation, at the option of the passenger, and$or a cash
incentive.
(d) n case the number of volunteers is not enough to resolve the
overboo9ing, the air carrier shall increase the compensation pac9age by
certain degrees or by adding more amenities$services until the reCuired
number of volunteers is met.
o @.5 overnment agencies and$or officials wanting to acCuire aircraft space
for official government purposes shall submit a written reCuest #ustifying the
reCuisition to the A", which shall then ma9e the reCuest to the air carrier
concerned, detailing:
(a) 1he number, identities, and affiliation of the persons reCuesting for
spaceE
(b) 1he date and time (if applicable) of the flightE and
(c) 1he destination.
!hould government reCuisition result in passengers having to forego their
confirmed space, the air carrier shall loo9 for volunteers in accordance with
!ection @..
Provided, that the air carrier shall have the right to claim from the
reCuesting government entity the full6fare value of the seats reCuisitioned by
the latter.
o @.0 1he settling of compensation for passengers pursuant to this !ection
shall not be an excuse for the undue delay of the flightDs &1B.
!ection . Ri)! !o Co/"ensa!ion an( A/eni!ies in Caseo0 Cancella!ion o0  &1B for causes attributable to the carrier, it shall be deemed cancelled for
;li)!. n case of cancellation of flights, the following shall be observed:
o . n case of flight cancellation attributable to the carrier, a passenger
shall have the right to:
(a) "e notified beforehand via public announcement, written$published
notice and flight status update service (text)E
(b) "e provided with the following, if he$she is already at the airport at the
time of the announcement of the flight cancellation: sufficient refreshments
or meals (e.g. snac9s consisting of at least a bottle of water and a sandwich,
or brea9fast, lunch, or dinner, or a voucher for the same, as the case may
be)E hotel accommodation (conveniently accessible from the airport)E
transportation from the airport to the hotel, v.v.E free phone calls, text or e6
mails, and first aid, if necessaryE and
(c) Reimbursement of the value of the fare, including taxes and surcharges,
of the sector cancelled, or both$all sectors, in case the passenger decides
not to fly the tic9et or all the routes$sectorsE or
(d) "e endorsed to another air carrier without paying any fare difference, at
the option of the passenger, and provided that space and other
circumstances permit such re6accommodationE or
(e) Reboo9 the tic9et, without additional charge, to the next flight with
available space, or, within thirty (0@) days, to a future trip within the period
of validity of the tic9et. ;owever, for reboo9ing made in excess of the
aforementioned thirty (0@) days for a trip li9ewise within the validity of the
tic9et, fees and$or fare difference shall apply.
Provided, that in case a carrier cancels a flight at least twenty6four (5?)
hours before the &1B, it shall not be liable for the foregoing amenities,
except, it shall be obliged to notify the passenger, and, in accordance with
the preceding provisions, to reboo9 or reimburse the passenger, at the
option of the latter.
o .5 n case the air carrier cancels the flight because of force ma#eure,
safety and$or security reasons, as certified by the ivil Aviation Authority of 
the Philippines, a passenger shall have the right to be reimbursed for the full
value of the fare.
o .0 1he provisions of this !ection shall be the minimum entitlement of a
passenger in case of cancellation, and shall not prohibit the air carrier from
granting more favourable conditions or recourses, as it may deem
appropriate.
!ection 5. Ri)! !o Co/"ensa!ion an( A/eni!ies in Case o0 ;li)! Dela$ an( 
E<ce"!ions Tere!o.
o 5. n case of 1erminal Belay of at least three (0) hours after the &1B,
whether or not such is attributable to the carrier, a passenger shall have the
right to:
(a) "e provided with refreshments or meals (sufficient snac9s, brea9fast,
lunch, or dinner, as the case may be), free phone calls, text or e6mails, and
first aid, if necessaryE and
(b) Reboo9 or refund his$her tic9et in accordance with the preceding !ection
or be endorsed to another carrier, in accordance with the preceding !ection.
o 5.5 n case such 1erminal Belay extends to at least six (>) hours after the
the purpose of ma9ing available to the passenger the rights and amenities
reCuired to be provided in case of actual cancellation, as provided for in
!ection .E and in addition, an affected passenger shall be given the
following:
(a) Additional compensation eCuivalent to at least the value of the sector
delayed or deemed cancelled to be paid in the form of cash or voucher, at
the discretion of the air carrierE and
(b) 1he right to board the flight if it ta9es place more than six (>) hours
after the &1B and the affected passenger has not opted to reboo9 and$or
refund. 2or this purpose, the air carrier is obliged to exert all efforts to
contact the passenger for the flight.
o 5.0 A passenger shall li9ewise have the right to be provided with sufficient
food and beverage, in cases of 1armac Belay of at least two (5) hours after
the &1B, rec9oned from the closing of the aircraft doors, or when the
,-?  of ,-