TRANSPO NOTES (based on Atty.

Padilla’s Syllabus)

5.2 Tatad v Garcia, Jr

5.3 Registered Owner Rule

PART I - COMMON CARRIERS 5.3.1 Gelisan v Alday
5.3.2 Benedicto v IAC
5.3.3 Erezo v Jepte

CHAPTER I – DEFINITION AND CONCEPT OF COMMON CARRIER 5.4 “Kabit System”

5.4.1 Santos v Sibug
5.4.2 Lita Enterprises Inc v IAC
1. Article 1732, Civil Code; Broad Concept 5.4.3 Teja Marketing v IAC
1.1 De Guzman v CA 5.4.4 Lim v CA
1.2 Cruz v Sun Holidays Inc
1.3 First Phil Industrial Corp v CA 5.5 Boundary System
1.4 Calvo v UCPB General Insurance 5.5.1 Magboo v Bernardo
1.5 Asia Lighterage and Shipping, Inc. v CA 5.5.2 Sps. Hernandez v Sps. Dolor
1.6 Asian Termininals Inc. v Daehan Fire and Marine Insurance Co
6. Governing Law on Common Carriers
1.7 Sps Perena v Sps Zarate 6.1 Applicable Laws
6.2 Conflicts Rule (Art 1753, NCC)
2. Characteristics; Test 6.3 Eastern Shipping Lines v IAC
2.1 Fisher v Yangco Steamship 6.4 Nat’l Dev’t Co v CA
2.2 US v Quinajon
2.3 Loadstar Shipping Co v CA 7. Obligations of Common Carrier, in General
2.4 Nat’l Steel Crop v CA
2.5 Certificate of Public Convenience (De Guzman v CA) 7.1 Commencement
2.6 Ownership of Vehicle Used as Carrier
2.6.1 Registered Owner Rule (see 5) 7.2 Duty to Serve; Exceptions
2.6.2 Cebu Salvage Corp v Ph Home Assurance Corp 7.2.1 Int’l Maritime Dangerous Goods (IMDG) Code
2.6.3 Nonvessel Operating Common Carrier (NVOCC) 7.2.2 MARINA Circular No. 1 Series 2008 (Carriage of Dangerous Goods in Domestic Trade)

3. Distinguished from Private Carrier 7.3 Duty to Deliver

3.1 Planters Products Inc v CA 7.3.1 Actual Delivery v Constructive Delivery
3.2 San Pablo v Pantranco 7.3.2 Code of Commerce provisions
3.3 Limited Clientele 7.3.3 Where and to Whom Delivered
3.3.1 Ph American General Insurance Co v PKS 7.3.3.1 Place
3.3.2 FGU Insurance Corp v GP Sarmiento Trucking Corp 7.3.3.2 Consignee
3.4 Line Service v Tramp Service
7.4 Duty to Exercise Extraordinary Diligence
4. Contract of Carriage Distinguished from other Transactions
4.1 Towage (Baer Senior & Co v La Compania Maritima) 8. Perfection of Contract of Common Carriage
4.2 Stevedoring (Mindanao Terminal and Brokerage Service Inc v Phoenix Assurance Company) 8.1 Aspects of Contract of Carriage
4.3 Arraste/Terminal Operator (Asian Terminals Inc v Daehan Fire and Marine Insurance Co; 8.1.1 British Airways Inc. v CA
Asian Terminal Inc v First Lepanto-Taisho Insurance Corp) 8.2 Carriage of Goods
4.4 Freight Forwarding (Unsworth Transport International Phils Inc v CA) 8.3 Carriage of Passengers
4.5 Travel Agency (Crisostomo v CA) 8.3.1 Manay, Jr. v Cebu Air, Inc
4.6 Transportation Network Companies (TNC) v Transporttation Network Vehicle Service (TNVS) 8.3.2 Ramos v China Southern Airlines Co
(LTFRB Memo Circular 2015-015)

5. Government Regulation of Common Carrier’s Business; Public Policies

5.1 Public Interest Doctrine (KMU Labor Center v Garcia)
1
 TRANSPO NOTES (based on Atty. Padilla’s Syllabus)

8.6.4 Compliance with Traffic Regulations (See Doctrine of Negligence per se)
8.6.5 Prohibition against Improper Deviation (Art. 359, Code of Commerce)
8.6.6 Inspection of Cargo on Reasonable Grounds

PART I - COMMON CARRIERS 8.7 Carriage by Air

8.7.1 Airworthiness (Sec. 3(z), Civil Aviation Authority Act)
8.7.2 Competence and Fitness of the Crew
8.7.3 Warranty against Improper Deviation
CHAPTER II – CONTRACT OF COMMON CARRIAGE 8.7.4 Duty to Inspect Cargo and Baggage (Sec. 8, RA 6235)

A. VIGILANCE OVER GOODS 8.8 Carriage of Dangerous Goods (DG)

8.8.1 Safe Carriage of DG
2. Extraordinary Diligence Required of Common Carriers (Art 1733, NCC) 8.8.2 Duty to Discharge or Destroy DG (Sec. 4(6), COGSA)
8.8.3 Acceptance, Shipping and Hadling of DG in accordance with the 2012 Int’l Maritime Dangerous
8.4 Definition and Reason for the Policy Goods code (IMDG) and MARINA Memo. Circular No.1, Series of 2008
8.4.1.1 Republic v Lorenzo 8.8.4 Duty to Secure DG from Unauthorized Access
8.4.1.2 Doctrine of Non-delegable Duty as applied to Common Carriers 8.8.5 Proper Training in Handling DG
8.8.6 Survey or Inspection of Cargo to Enforce Compliance with IMDG and other Regulations
8.5 Carriage by Sea
3. Liability of Carriers for Loss, Destruction, and Deterioration of Goods (Arts 1734-1735; 1739-1743,
8.5.1 Seaworthiness; Meaning NCC)
8.5.1.1 Case Law (Standard Vacuum Oil Co v Luzon Stevedoring) ; (Loadstar v CA)
8.5.1.2 Statutes in Pari Materia (Sec. 3(1)(a)(b), COGSA; Secs. 116-119, Insurance Code) 2.1 Presumption of Negligence (Regional Container Lines of SG v Netherlands Insurance)

8.5.2 When Should a Ship be Seaworthy 2.2 Common Carrier Defenses; Exclusive
8.5.2.1 COGSA
8.5.2.2 Common Law; Doctrine of Stages 2.2.1 Acts of God (Arts. 1734(1), 1739, and 1740)
8.5.2.3 Domestic Shipping Act (RA 9295) 2.2.1.1 2013 Heavy Weather Guidelines (PCG Memo Circular 02-2013)
2.2.1.2 Eastern Shipping Lines v IAC
8.5.3 Does Presumption of Fault Translate to Presumption of Unseaworthiness? 2.2.1.3 Eastern Shipping Lines v CA
2.2.1.4 Schmitz Transport & Brokerage Corp v Transport Venture
8.5.4 Presumption of Unseaworthiness in Certain Cases 2.2.1.5 PH American General Insurance Co v PKS Shipping Co
2.2.1.6 Transimex Co v. Mafre Asian Insurance Co
8.5.5 Cargoworthiness
8.5.5.1 Case Law (Santiago Lighterage v CA) 2.2.2 Acts of Public Enemy (Arts. 1734(3) and 1739)
8.5.5.2 Sec. 3(1)(c), COGSA 2.2.2.1 Existence of War; Prize Cases
2.2.2.2 Piracy
8.5.6 Sufficient Freeboard (See 1.1.1.1 Int’l Convention on Load Lines 1966) 2.2.2.3 Rebels as Public Enemy
8.5.6.1.1 Compulsory Marking of Int’l Load Lines (Plimsoll Line)
8.5.6.1.2 Plimsoll Line must not be submerged 2.2.3 Shipper/Owner’s Fault (Arts. 1734(3) and 1741)
2.2.3.1 Who are Considered Shipper and/or Owner
8.5.7 Warranty against Improper Deviation 2.2.3.2 Sole and Proximate vs Contributory only
2.2.3.3 Compania Maritima v CA
8.5.8 Survey or Inspection of Caargo on Reasonable Grounds 2.2.3.4 Delsan Trans Lines v American Home Assurance
2.2.3.5 “Shipper’s Load and Count” Arrangement (Marina Port Services, Inc v American Assurnce)

8.6 Carriage by Land 2.2.4 Inherent Vice (Arts. 1734(4) and 1742)
8.6.1 Road Worthiness and Railworthiness 2.2.4.1 Belgian Overseas Chartering and Shipping v Ph First Insurance
8.6.2 Motor Vehicle Must be in Good Condition 2.2.4.2 Asian Terminals v Simon Enterprises
8.6.3 Warranty against Defective Vehicles Parts 2.2.4.3 Planters Products v CA

2
 TRANSPO NOTES (based on Atty. Padilla’s Syllabus)

2.2.5 Defects in the Packing or in the Container (Arts. 1734(4) and 1742) A bill of lading is a written acknowledgment of the receipt of the goods and an agreement to transport and
2.2.5.1 Regional Container Lines of SG v Netherlands Insurance Co PH deliver them at a specified place to a person named or on his order. Such instrument may be called a
2.2.5.2 Ph Charter Insurance Co v Unknown Owner of M/V “National Honor” shipping receipt, forwarder's receipt and receipt for transportation. The designation, however, is
2.2.5.3 Southern Lines v CA immaterial. It has been held that freight tickets for bus companies as well as receipts for cargo transported
2.2.5.4 Calvo v UCPB by all forms of transportation, whether by sea or land, fall within the definition. Under the Tariff and
Customs Code, a bill of lading includes airway bills of lading.
2.2.6 Acts of Public Authority (Arts. 1734(5) and 1743)
2.2.6.1 Ganzon v CA TWO FOLD CHARACTER OF A BILL OF LADING
2.2.6.2 Examples (1) it is a receipt as to the quantity and description of the goods shipped; and
(2) a contract to transport the goods to the consignee or other person therein designated, on the terms
2.2.7 Extraordinary Diligence specified in such instrument.
2.2.7.1 Republic v Lorenzo Shipping Corp
2.2.7.2 De Guzman v CA (Emergency Rule) (Saludo v CA)

2.2.8 Fortuitous Events 3.3 Temporary Unloading and Storage in Transit

2.2.8.1 Casus Fortuitous Nemo Prestat; Impossibilum Nulla Obligation Est
2.2.8.2 De Guzman v CA 3.3.1 Effect of Stoppage in Transitu
2.2.8.3 Ganzon v CA
2.2.8.4 Barcos v CA -Explicit is the rule under Article 1736 of the Civil Code that the extraordinary responsibility of the
2.2.8.5 Loadmasters Customs Services v Glodel Brokerage Corp common carrier begins from the time the goods are delivered to the carrier. This responsibility remains in
2.2.8.6 Torres-Madrid Brokerage v FEB Mitsui Marine Insurance Co full force and effect even when they are temporarily unloaded or stored in transit, unless the shipper or
2.2.8.7 Servando v Ph Steam Navigation owner exercises the right of stoppage in transitu, and terminates only after the lapse of a reasonable time
for the acceptance of the goods by the consignee or such other person entitled to receive them. And, there
2.2.9 Partial Defense: Shipper/Consignee’s Contributory Fault or Negligence is delivery to the carrier when the goods are ready for and have been placed in the exclusive possession,
2.2.9.1 Tabacalera Insurance Co v North Front Shipping Services custody and control of the carrier for the purpose of their immediate transportation and the carrier has
2.2.9.2 Compania Maritima v CA accepted them. Where such a delivery has thus been accepted by the carrier, the liability of the common
carrier commences eo instanti. (Saludo v CA)

3 Commencement, Duration, and Termination of Carrier’s Responsibility over the Goods 3.4 Actual or Constructive Delivery
(Arts 1736-1738, NCC)
Carrier may be relieved from the responsibility for loss or damage to the goods upon actual or constructive
3.1 Unconditionally Placed in the Possession of and Received by the Carrier delivery of the same by the carrier to the consignee or to the person who has the right to receive them.

Art 1736. The extraordinary responsibility of the common carrier lasts from the time the goods are (a) ACTUAL DELIVERY
unconditionally placed in the possession of, and received by the carrier for the transportation until -There is actual delivery in contracts for the transport of goods when possession has been turned over
the same are delivered, actually or constructively, by the carrier to the consignee, or to the person who to the consignee or to his duly authorized agent and a reasonable time is given him to remove the
has a right to receive them, without prejudice to the provisions of Article 1738. goods.

- if actually no goods are received there can be no contract. The liability and responsibility of the carrier
under a contract for the carriage of goods commence on their actual delivery to, or receipt by, the carrier
or an authorized agent.
-The test as to whether the relation of shipper and carrier had been established is, had the control
and possession of the goods been completely surrendered by the shipper to the carrier? Whenever
the control and possession of goods passes to the carrier and nothing remains to be done by the shipper,
then it can be said with certainty that the relation of shipper and carrier has been established.
(b) CONSTRUCTIVE DELIVERY
(c) When are the goods deemed delivered?
-When the goods are ready for and have been placed in the exclusive possession, custody and control
of the carrier for the purpose of their immediate transportation and the carrier has accepted them.
When such delivery has thus been accepted by the carrier, the liability of the carrier commences eo
instanti.

(Compania Maritima v Insurance Co. Of North America) 3.4.1 To the Consignee

(Ganzon v CA)
“The responsibility of common carriers to exercise extraordinary diligence lasts from the time the
3.2 Bill of Lading as Evidence of Delivery to the Carrier goods are unconditionally placed in their possession until they are delivered "to the consignee, or to
the person who has a right to receive them." Thus, part of the extraordinary responsibility of
common carriers is the duty to ensure that shipments are received by none but "the person who has
3
 TRANSPO NOTES (based on Atty. Padilla’s Syllabus)

a right to receive them." Common carriers must ascertain the identity of the recipient. Failing to "transship" means:
deliver shipment to the designated recipient amounts to a failure to deliver. The shipment shall then "to transfer for further transportation from one ship or conveyance to another"
be considered lost, and liability for this loss ensues.” (Federal Express v Antonio)

(Federal Express v Antonio) (Samar Mining Co, Inc v Nordeutscher Lloyd)

3.4.2 To the Person who has Right to Receive Cargo

“Delivery is valid and it terminates the contract, as a matter of law. The contract is already
terminated.” (Macam v CA)

(Lu Do & Lu v Binamira)

(Nedlloyd Lijnen BV Rotterdam v Glow Laks Enterp)

(Macam v CA)

(see discussions on p.7, Transpo Lectures file)

3.5 Delivery to the Consignee Without Surrender of Bill of Lading

“A common carrier may release the goods to the consignee even without the surrender of the bill of
lading. The bill of lading shows no requirement requiring surrender of the bill of lading prior to
release and delivery of the goods, despite DBI’s claim. ASTI and ACCLI, therefore, have no
obligation to release the goods only upon the surrender of the bill of lading. In any case,
Art. 353 of the Code of Commerce provides that in case the consignee cannot return the bill
of lading, he must give a receipt producing the same effects as the return of a bill of lading.

Generally, upon receipt of the goods, the consignee surrenders the bill of lading to the
carrier and their respective obligations are canceled. The law provides for two exceptions:
when the bill of lading gets lost or for other case, the consignee must issue a receipt.
Clearly, non-surrender of the original bill of lading does not violate the carrier’s duty of
extraordinary diligence over the goods.” (Designer Baskets, Inc. v Air Sea Transport, Inc.)

“Release of the goods without surrendering the bill of lading was upheld
despite the bill of lading providing for the surrender of one of the bills of lading due to the
(1) telex instructions to the carrier to deliver the goods without need of presenting said bill
of lading; and (2) such was noted usual practice of the shipper to request shipping lines
immediately to release perishable cargoes through telephone calls.” (Macam v CA)

(Designer Baskets, Inc. v Air Sea Transport, Inc.)

3.6 Custody over Cargo During Unloading

It is settled in maritime law jurisprudence that cargoes while being unloaded generally remain
under the custody of the carrier (Regional Container Lines v. Netherlands)

(Regional Container Lines v Netherlands Insurance Co.)

(Phil First Isurance Co, Inc. v Wallen Phils Shipping, Inc)

3.7 Duty to Ship vs Duty to Transship

4
 TRANSPO NOTES (based on Atty. Padilla’s Syllabus)

Art 1752. Even when there is an agreement limiting the liability of the common carrier in the
vigilance over the goods, the common carrier is disputably presumed to have been negligent
4 Stipulations Limiting Carrier’s Liability
in case of their loss, destruction or deterioration.
4.1 Articles 1744-1748; 1751-1752
4.2 Minimum Degree of Diligence Required
Art. 1744. 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: 4.3 Void Stipulations (Art 1745 NCC)
(1) In writing, signed by the shipper or owner; (Sweet Lines v Teves) p.119
(2) Supported by a valuable consideration other
than the service rendered by the common carrier; and 4.4. Reasonable Time in Delivery of Goods
(3) Reasonable, just and not contrary to public policy.
(Maersk Lines v CA) p.121
Art 1745. Any of the following or similar stipulations shall be considered unreasonable, unjust
and contrary to public policy: 4.5 Articles 1749-1750, Civil Code; Limitation on the Amount of Liability
(1) That the goods are transported at the risk of the owner or shipper;
(2) That the common carrier will not be liable for any loss, destruction, or deterioration of the 4.5.1 Ad Valorem B/L
goods;
(3) That the common carrier need not observe any diligence in the custody of goods; (Ysmael v. Barreto) p.122
(4) That the common carrier shall exercise a degree of diligence less than a good father of a (Shewaram v PAL) p.124
family, or of man of ordinary prudence in the vigilance over the movables transported; (Ong Yiu v CA) p.126
(5) That the common carrier not be responsible for the acts or omission of his or its employees; (Sea-Land Services v IAC) p.128
(6) That the common carrier’s liability for acts committed by thieves, or of robbers who do not (Citadel v CA) p.131
act with grave or irresistible threat, violence or force, is dispensed with or diminished; (Everett v Steamship v CA) p.132
(7) That the common carrier is not responsible for the loss, destruction, or deterioration of (British Airways v CA) p.134
goods on account of the defective condition of the car, vehicle, ship airplane or other (H.E. Heacock Co. v Macondray) p.136
equipment used in the contract of carriage.

Art 1746. An agreement limiting the common carrier’s liability may be annulled by the hipper 5 Passenger’s Baggages (Article 1754)
or owner if the common carrier refused to carry the goods unless the former agreed to such
stipulation. 5.1 Checked-in v. Hand-carried Baggages

Art 1747. If the common carrier, without just cause, delays the transportation of the goods (Quisimbing Sr. v CA) p.138
or changes the stipulated or usual route, the contract limiting the common carriers liability (Pan American Airlines v Rapadas) p.139
cannot be availed of in case of loss, destruction, or deterioration of the goods. (British Airways v CA) p.134
(Alitalia v IAC) p.141
Art 1748. An agreement limiting the common carrier’s liability for delay on account of strikes
or riots is valid.

Art 1751. The fact that the common carrier has no competitor along the line or route, or part
thereof, to which the contract refers shall be taken into consideration on the question of
whether or not a stipulation limiting the common carrier’s liability is reasonable, just and in
consonance with public policy.