transportation LAW

A.Y. 2018-2019

CASE TITLE: PLANTERS PRODUCT INC. VS CA

G.R. NO/DATE: G.R. No. 101503 / September 15, 1993
Common carrier should observe extraordinary diligence in the vigilance over the
goods they carry; in case of loss, destruction or deterioration of the goods, it is
DOCTRINE:
presumed to be at fault or to have acted negligently, and the burden of proving
otherwise rests on it.

FACTS:

Planters Products purchased from Mitsubishi Inter’l Corp. 9.3K metric tons of Urea (fertilizer), 46%
of which the latter shipped in bulk aboard the cargo vessel M/V “Sun Plum” owned by Kyosei Kisen
Kabushiki Kaisha (KKKK). A Time Charter- Party on the vessel M/V “Sun Plum” pursuant to the Uniform
General Charter was entered into between Mitsubishi as shipper/charter and KKKK as ship owner.

Before loading the fertilizer aboard the vessel they were inspected by the charterer’s representative
and found fit for loading. After the Urea fertilizer was loaded in bulk by stevedores (somebody whose job is
to load and unload ships) hired by and under the supervision of the shipper, the steel hatches were closed
with heavy iron lids, covered with 3 layers of tarpaulin, then tied with steel bonds. The hatches remained
closed and tightly sealed throughout the entire voyage.

Port area was windy, certain portions of the route to the warehouse were sandy and the weather
was variable, raining occasionally while the discharge was in progress. Survey report revealed a shortage
in the cargo of 106.726 M/T and that a portion of the Urea fertilizer approximating 18 M/T was contaminated
with sand, rust and dirt. Planters Products sent a claim letter to Soriamont Steamship Agencies, the resident
agent of the carrier, for damages.

ISSUE:

Whether or not a common carrier becomes a private carrier by reason of a charter-party;

HELD:

Yes. The Supreme Court defined Charter- party as a “contract by which an entire ship, or some
principal part thereof, is let by the owner to another person for a specified time or use; a contract of
affreightment by which the owner of a ship or other vessel lets the whole or a part of her to a merchant or
other person for the conveyance of goods, on a particular voyage, in consideration of the payment of freight”
It went further on discussing the two types of charter-party:

a. contract of affreightment – involves the use of shipping space on vessels leased by the owner in
part or as a whole, to carry goods for others; may either be: (i) time charter - vessel is leased to the charterer
for a fixed period of time; or (ii)voyage charter - ship is leased for a single voyage

b. charter by demise or bareboat charter – whole vessel is let to the charterer with a transfer to him
of its entire command and possession and consequent control over its navigation, including the master and
the crew, who are his servants.

In both types, the charter party provides for the hire of vessel only, either for a determinate period
of time or for a single or consecutive voyage, the ship owner to supply the ship’s stores, pay for the wages
of the master and the crew, and defray the expenses for the maintenance of the ship.

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 transportation LAW
A.Y. 2018-2019

Distinction between a “common or public carrier” and a “private or special carrier” lies in the
character of the business, such that if the undertaking is a single transaction, not a part of the general
business or occupation, although involving the carriage of goods for a fee, the person or corporation offering
such service is a private carrier.

Common carrier should observe extraordinary diligence in the vigilance over the goods they carry;
in case of loss, destruction or deterioration of the goods, it is presumed to be at fault or to have acted
negligently, and the burden of proving otherwise rests on it. Private carrier -exercise of ordinary diligence
in the carriage of goods will suffice; no such presumption applies to private carriers only when the charter
includes both the vessel and its crew, as in a bareboat or demise that a common carrier becomes private,
at least insofar as the particular voyage covering the charter-party is concerned when Planters Products
chartered the vessel M/V “Sun Plum”, the ship captain, its officers and compliment were under the employ
of the ship owner and therefore continued to be under its direct supervision and control. As stranger to the
crew and to the ship, Planters Products did not have the duty of caring for its cargo as it did not have control
of the means in doing so.