14. De Guzman vs.

Court of Appeals and Ernesto Cedaña

December 22, 1988
Feliciano, J.
Entities Involved:

1. Pedro de Guzman – petitioner- merchant and authorized dealer of General Milk

Company
2. Ernesto Cedaña- respondent- junk dealer engaged in buying bottles and scrap
metals in Pangasinan and hauls these to Manila; he owns 2 six-wheeler trucks which
he uses to transport these bottles and metals
3. Manuel Estrada- respondent’s driver and employee

Facts:

1. As a junk dealer, Ernesto Cedaña’s principal business activity is to buy scrap

materials from Pangasinan and transport it to Manila for resale. He was only
transporting return loads to Pangasinan (as what de Guzman is asking him to do) as
a sideline to his principal activity.
2. On Nov. 1970, de Guzman contracted the services of Cedaña to haul 750 cartons of
Liberty filled milk from a warehouse in Rizal to de Guzman’s establishment in
Pangasinan. (Cedaña even charged de Guzman a price lower than the regular rates).
3. On December 1, 1970, de Guzman loaded 150 cartons to a truck driven by him and
600 cartons to the truck driven by his driver, Manuel Estrada.
4. Only 150 cartons reached Pangasinan. The 600 cartons never reached Pangasinan
since the truck was hijacked by armed men somewhere along MacArthur highway
and took away with them the cargo, Manuel Estrada and a helper.
5. On January 6, 1971, de Guzman filed an action in CFI Pangasinan against Cedaña
demanding payment of P22, 150 as value of the merchandise lost, damages and
attorney’s fees.
6. CFI ruled in favor of de Guzman. Cedaña is liable for the value of undelivered goods,
damages and atty.’s fees.
7. CA reversed the decision of the CFI on the ground that Cedaña IS NOT a common
carrier because transporting return loads is only a sideline and not the principal
activity of Cedaña’s business. Moreover, the incident of hijacking is a force majeure.

• De Guzman’s Arguments • Cedaña’s defense

o Cedaña is a common carrier
and having failed to exercise
the extraordinary diligence
required of him by the law.
o He is not a common carrier and
that the lost of the goods is due
to force majeure (hijacking).
o He is not a common carrier
because his principal business
activity is not to transport or
hauling goods from one place
to another but being a junk
dealer.
o Prices he asks are below the
regular commercial rates.
o He held no certificate of public
convenience.
Issues
1. Is Cedaña a common carrier?
2. Can the hijacking of armed men be considered as force majeure?
3. Is Cedaña liable to the value of the undelivered goods?

Ruling:

a. Contract of Transportation: Yes

b. Common Carrier: Yes
c. (NOT SURE) Breach of Contract: No, because even if Cedaña was not able to deliver the
goods, there was still no breach of contract since the cause of the lost of the goods is due
to a fortuitous event.

Issue 1:

• YES. Cedaña is a common carrier.

• Article 1732 of the Civil Code defines common carriers as “persons, corporations,
firms or associations engaged in the business of carrying or transporting passengers
or goods or both, by land, water, or air for compensation, offering their services to
the public.”
o The article does not make any distinction as to:
 Who are engaged in a principal business activity and to those who had
a sideline (ancillary activity)
 Who offers transportation service on a regular basis or those who does
it occasionally.
 Who offers its services to the general public or only to a portion of the
general population.
• Even if Cedaña’s principal business activity is being a junk dealer who merely
transports the scrap metal he buys in Pangasinan to Manila for resale, he is still
considered a common carrier because he asks for compensation for his transporting
services. Although his sideline is merely “backhauling” but because he gets paid for
it, he is characterized as a common carrier.
• A certificate of public convenience does not determine whether one is a common
carrier or not. It is not a requisite for incurring of liability under the Civil Code.

Issue 2:

• No, the hijacking is not force majeure but a FORTUITOUS EVENT since it was well
beyond the control of Cedana as the common carrier.
• Article 1733 of the Civil Code states that common carriers “are held to a very high
degree of care and diligence in the carriage of goods as well as of passengers.”
Further, Article 1734 states the general rule that common carriers are responsible
for the loss and damage of goods they carry UNLESS certain causes occur: natural
disaster, war, omission of the shipper or owner of the goods, defects in the goods
and order of competent authority. These are considered as force majeure events.
• Those events not falling among those mentioned in 1734 may fall within the scope of
Article 1735 which states the PRESUMPTION OF NEGLIGENCE on the part of the
 common carrier UNLESS extraordinary diligence is proven.
• First, Article 1734 cannot be applied in the present case. As stated, Article 1734 is a
closed list and those not falling among those mentioned are not considered as force
majeure. The hijacking or robbery by armed men is not mentioned.
• Second, De Guzman is insisting that Cedaña did not exercise extraordinary diligence
because Cedana did not hire a security guard who would ride on the truck while
transporting 600 cartons. SC said that asking for a security guard is beyond the
scope of what can be considered as extraordinary diligence. Article 1745 (6) can
apply in the present case. The said article provides that a common carrier’s
responsibility can be diminished or divested only on cases where “such thieves or
robbers acted with grave threat, violence or force.” In the case at bar, there was
such thieves or robbers acted with grave threat, violence or force as proven in the
Criminal Case filed against the armed men who hijacked the truck. The crime
committed by these armed men is ROBBERY IN BAND -not robbery per se.

Issue 3:

• Having proven that the circumstances were well beyond the control of Cedana as
common carrier, he is exonerated from liability. The decision of the CA is AFFIRMED.

Terms / Concepts:

1. Common Carrier-Article 1732 provides that a common carrier is one

engaged in the business of carrying or transporting passengers or goods or
both for compensation and offering its services to the public.
2. Duty of extraordinary diligence- Article 1733 states that the common carrier should
have care and diligence in the carriage of goods and passengers. If anything goes
wrong with the goods or passengers, Article 1734 and 1735 states the presumption
of negligence on the part of the common carrier. PROOF of extraordinary diligence
exonerates the common carrier from liability.
3. Force Majeure- Article 1734 provides a closed list of force majeure events.
4. Fortuitous event- those events beyond the control of the common carrier – Article
1745 provides those instances where a common carrier’s liability may be diminished
or divested.