Transportation Law Case Ratio

ATI v. Allied Guarantee witnesses to verify the

Insurance correctness of the
1. Since the relationship of an document and to testify
arrastre operator and a that only 158 rolls was
consignee is akin to that reported and no others
between a warehouseman sustained damage while the
and a depositor, then, in shipment was in its
instances when the possession.
consignee claims any loss, 3. As it is now established that
the burden of proof is on there was negligence in
the arrastre operator to both petitioner ATI's and
show that it complied with Dynamic's performance of
the obligation to deliver the their duties in the handling,
goods and that the losses storage and delivery of the
were not due to its subject shipm~nt to San
negligence or that of its Miguel, resulting in the loss
employees. 51 A TI failed to of 54 rolls of kraft linear
dislodge this burden. board, both shall be
2. Marina, the arrastre solidarily liable for such
operator, from the above loss.
evidence, was not able to 4. It has been previously held
overcome the presumption tl)at the mere fact of"having
of negligence. The Bad been forced to litigate to
Order Cargo Receipts, the protect one's interest" does
Tum Over Survey of Bad not amount to the
Order Cargoes as well as compelling legal reason that
the Request for Bad Order would make a case covered
Survey did not establish by any of the exceptions
that the additional 54 rolls provided under Article
were in good condition 2208.
while in the custody of the
arrastre. Said documents Eastern Shipping v. BPI
proved only that indeed the 1. It was shown to this
158 rolls were already Court that a Request for
damaged when they were Bad Order Survey is a
discharged to the arrastre document which is
operator and whep. it was requested by an interested
subsequently withdrawn party that incorporates
from the arrastre operator therein the details of the
by [the] customs broker. damage, if any, suffered
Further, the Tum Over by a shipped commodity.
Inspector and the Bad Order Also, a TOSBOC, usually
Inspector who conducted issued by the arrastre
the inspections and who contractor (ATI in this
signed the Turn Over Survey case), is a form of
of Bad [Order] Cargoes and certification that states
the Request for Bad Order therein the bad order
Survey, respectively, were condition of a particular
not presented by Marina as cargo, as found prior to
Transportation Law Case Ratio

its turn over to the actually or constructively,

custody or possession of by the carrier to the
the said arrastre contractor. consignee, or to the
2. Verily, it is settled in person who has a right to
maritime law receive them.
jurisprudence that cargoes 4. Owing to this high degree
while being unloaded of diligence required of
generally remain under them, common carriers, as
the custody of the carrier. a general rule, are
As hereinbefore found by presumed to have been
the RTC and affirmed by at fault or negligent if
the CA based on the the goods they
evidence presented, the transported deteriorated or
goods were damaged got lost or destroyed.
even before they were That is, unless they prove
turned over to ATI. Such that they exercised
damage was even extraordinarydiligence in
compounded by the transporting the goods. In
negligent acts of order to avoid
petitioner and ATI which responsibility for any loss
both mishandled the or damage, therefore,
goods during the they have the burden of
discharging operations. proving that they
3. Thus, it bears stressing observed such high level
unto petitioner that of diligence. In this case,
common carriers, from the petitioner failed to hurdle
nature of their business such burden.
and for reasons of public
policy, are bound to GV Florida Transport v. HO
observe extraordinary Ramon Battung
diligence in the vigilance 1. Art. 1733. Common
over the goods carriers, from the nature
transported by them. of their business and for
Subject to certain reasons of public policy,
exceptions enumerated are bound to observe
under Article 173431 of extraordinary diligence in
the Civil Code, common the vigilance over the
carriers are responsible goods and for the safety
for the loss, destruction, of the passengers
or deterioration of the transported them,
goods. The extraordinary according to all the
responsibility of the circumstances of each case.
common carrier lasts from 2. Art. 1755. A common
the time the goods are carrier is bound to carry
unconditionally placed in the passengers safely as
the possession of, and far as human care and
received by the carrier foresight can provide,
for transportation until the using the utmost diligence
same are delivered, of very cautious persons,
Transportation Law Case Ratio

with a due regard for all (2) to the negligent or

the circumstances. willful acts of the common
3. In this relation, Article carrier's employees with
1756 of the Civil Code respect to the foregoing -
provides that "[i]n case of such as when the injury
death of or injuries to arises wholly from causes
passengers, common created by strangers
carriers are presumed to which the carrier had no
have been at fault or to control of or prior
have acted negligently, knowledge to prevent
unless they prove that there would be no issue
they observed regarding the common
extraordinary diligence as carrier's negligence in its
prescribed in Articles duty to provide safe and
1733 and 1755." This suitable care, as well as
disputable presumption competent employees in
may also be overcome by relation to its transport
a showing that the business; as such, the
accident was caused by a presumption of
fortuitous event. fault/negligence foisted
4. While the law requires under Article 1756 of the
the highest degree of Civil Code should not
diligence from common apply.
carriers in the safe 7. On the other hand, since
transport of their Battung's death was
passengers and creates a caused by a co-
presumption of negligence passenger, the applicable
against them, it does not, provision is Article 1763 of
however, make the carrier the Civil Code, which
an insurer of the absolute states that "a common
safety of its passengers. carrier is responsible for
5. Therefore, it is imperative injuries suffered by a
for a party claiming passenger on account of
against a common carrier the willful acts or
under the above-said negligence of other
provisions to show that passengers or of
the injury or death to the strangers, if the common
passenger/s arose from carrier's employees
the negligence of the through the exercise of
common carrier and/or the diligence of a good
employees in providing safe father of a family could
transport to its passengers. have prevented or
6. The Court clarified that stopped the act or
where the injury sustained omission." Notably, for
by the passenger was in this obligation, the law
no way due (1) to any provides a lesser degree
defect in the means of of diligence, i.e., diligence
transport or in the of a good father of a
method of transporting, or family, in assessing the
Transportation Law Case Ratio
existence of any
culpability on the common
carrier's part.
8. By all accounts, therefore,
it cannot be concluded
that petitioner or any of
its employees failed to
employ the diligence of a
good father of a family in
relation to its
responsibility under Article
1763 of the Civil Code.
As such, petitioner cannot
altogether be held civilly
liable.
MMTC v. Cuevas
1. The registered owner of a
motor vehicle whose
operation causes injury to
another is legally liable to
the latter. But it is error not
to allow the registered
owner to recover
reimbursement from the
actual and present owner
by way of its cross-claim.
2. In view of MMTCs
admission in its pleadings
that it had remained the
registered owner of the bus
at the time of the incident,
it could not escapeliability
for the personal injuries and
property damage suffered
by the Cuevases. This is
because of the registered-
owner rule, whereby the
registered owner of the
motor vehicle involved in a
vehicular accident could be
held liable for the
consequences. The
registered-owner rule has
remained good law in this
jurisdiction considering its
impeccable and timeless
rationale.
3. Registration is required not
to make said registration
the operative act by which
ownership in vehicles is
transferred, as in land
registration cases, because
the administrative
proceeding of registration
does not bear any essential
relation to the contract of
sale between the parties
(Chinchilla vs. Rafael and
Verdaguer, 39 Phil. 888),
but to permit the use and
operation of the vehicle
upon any public highway
(section 5 [a], Act No. 3992,
as amended.) The main
aim of motor vehicle
registration is to identify
the owner so that if any
accident happens, or that
any damage or injury is
caused by the vehicle on
the public highways,
responsibility therefor can
be fixed on a definite
individual, the registered
owner. Instances are
numerous where vehicles
running on public highways
caused accidents or injuries
to pedestrians or other
vehicles without positive
identification of the owner
or drivers, or with very
scant means of
identification. It is to
forestall these
circumstances, so
inconvenient or prejudicial
to the public, that the
motor vehicle registration
is primarily ordained, in the
interest of the
determination of persons
responsible for damages or
injuries caused on public
highways.
Transportation Law Case Ratio

4. It is well settled that in the erring bus. Although

case of motor vehicle the registered-owner rule
mishaps, the registered might seem to be unjust
owner of the motor vehicle towards MMTC, the law did
is considered as the not leave it without any
employer ofthe tortfeasor- remedy or recourse.
driver, and is made According to Filcar
primarily liable for the tort Transport Services v.
committed by the latter Espinas,14 MMTC could
under Article 2176, in recover from Minas Transit,
relation with Article 2180, of the actual employer of the
the Civil Code. In Equitable negligent driver, under the
Leasing Corporation v. principle of unjust
Suyom, we ruled that in so enrichment, by means of a
far as third persons are cross-claim seeking
concerned, the registered reimbursement of all the
owner of the motor vehicle amounts that it could be
is the employer of the required to pay as
negligent driver, and the damages arising from the
actual employer is drivers negligence.
considered merely as an
agent of such owner. Unknown Owner v. ATI
5. Regardless of sales made of 1. Free-In-and-Out-Stowed-
a motor vehicle, the and-Trimmed (FIOST)
registered owner is the Clause, which supposedly
lawful operator insofar as means that the
the public and third persons Shipper/Charterer itself
are concerned; (ContiQuincyBunge LLC)
consequently, it is directly loaded the cargo on board
and primarily responsible the Vessel, and the latter
for the consequences of its and her complement had
operation. The Court no participation therein
further stated that [i]n except to provide the use of
contemplation of law, the the Vessels gear. Similarly,
owner/operator of record is under the FIOST clause, the
the employer of the driver, discharge of the cargo was
the actual operator and to be done by the
employer being considered consignees designated
as merely its agent. personnel without any
6. Indeed, MMTC could not participation of the Vessel
evade liability by passing and her complement.
the buck to Minas Transit. 2. Contract of affreightment
The stipulation in the by which the owner of a
agreement to sell did not ship lets the whole or part
bind third parties like the of her to a merchant or
Cuevases, who were other person for the
expected to simply rely on conveyance of goods, on a
the data contained in the particular voyage, in
registration certificate of consideration of the
Transportation Law Case Ratio

payment of freight. The amount of damages

Supreme Court has held actually proved.
that if the charter is a 5. The Court agrees with the
contract of affreightment, CA that the petitioners are
the rights and the liable to ATI for the damage
responsibilities of sustained by the latters
ownership rest on the unloader. However, the
owner. The charterer is Court finds the petitioners
free from liability to third liability to be based on
persons in respect of the quasi-delict and not on a
ship. contract of carriage. The
3. The res ipsa loquitur Court likewise deems it
doctrine is based in part proper to modify the rate of
upon the theory that the interests on the amount of
defendant in charge of the damages imposed by the
instrumentality which CA upon the petitioners.
causes the injury either 6. In the assailed decision, the
knows the cause of the CA, on the other hand,
accident or has the best discussed in detail why and
opportunity of ascertaining how the three requisites to
it and that the plaintiff has the application of the
no such knowledge, and doctrine of res ipsa
therefore is compelled to loquitur are found to be
allege negligence in attendant in the case at
general terms and to rely bar. First, the co-mingling
upon the proof of the of the two foreign metal
happening of the accident objects with the soybean
in order to establish meal cargo and the
negligence. consequent damage to
4. The prima facie evidence ATIs unloader is an
of defendants negligence, accident which ordinarily
being unexplained and does not occur in the
uncontroverted, is sufficient absence of someones
to maintain the proposition negligence. Second, the
affirmed. Hence, the foreign metal objects were
negligence of the Master of found in the vessels Hold
the Vessel is conclusively No. 2, which is within the
presumed to be the exclusive control of the
proximate cause of the petitioners. Third, records
damage sustained by ATIs do not show that ATIs
unloader. Moreover, since negligence had in any way
the Masters liability is contributed to the damage
ultimately that of the caused to its unloader.
shipowner because he is the 7. There is no contract of
representative of the carriage between ATI, on
shipowner, the shipowner one hand, and the
and its agents are solidarily shipowner, Samsun,
liable to pay ATI the ContiQuincyBunge L.L.C.,
and Inter-Asia, on the other.
Transportation Law Case Ratio

It likewise bears stressing 9. The CA had exhaustively

that the subject of the discussed why the doctrine
complaint, from which the of res ipsa loquitur
instant petition arose, is not applies. The metal bars
the damage caused to the which caused damage to
cargo, but to the equipment ATIs unloader was found
of an arrastre operator. co-mingled with the cargo
Further, ATIs contractual inside Hold No. 2 of the
relation is not with the ship, which was then within
petitioners, but with the the exclusive control of the
consignee and with the petitioners. Thus, the
Philippine Ports Authority presumption that it was the
(PPA). petitioners collective
8. The legal relationship negligence, which caused
between an arrastre the damage, stands. This
operator and a consignee is is, however, without
akin to that between a prejudice to the petitioners
warehouseman and a rights to seek
depositor. As to both the reimbursements among
nature of the functions and themselves from the party
the place of their whose negligence primarily
performance, an arrastre caused the damage.
operators services are
clearly not maritime in
character.