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Docshare - Tips Transportation Law
Docshare - Tips Transportation Law
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MEMORY AID IN COMMERCIAL LAW
TRANSPORTATION LAWS
Parties
1. Common carrier 1. Common carrier
2. Shipper 2. Passenger
3. Consignee
Cause of liability
Delay in delivery, loss, destruction, or Death or injury to the passengers
deterioration of the goods
Duration of liability
From the time the goods are unconditionally The duty of a common carrier to provide safety
placed in the possession of, and received by the to its passengers so obligates it not only during
carrier for transportation until the same are the course of the trip, but for so long as the
delivered actually or constructively by the passengers are within its premises and where
carrier to the consignee or to the person who they ought to be in pursuance to the contract
has the right to receive them. (Art. 1736) of carriage. (LRTA v. Navidad, [2003])
It remains in full force and effect even when All persons who remain on the premises within
they are temporarily unloaded or stored in a reasonable time after leaving the conveyance
transit unless the shipper or owner has made are to be deemed passengers, and what is a
use of the right of stoppage in transitu. (Art. reasonable time or a reasonable delay within
1737) this rule is to be determined from all the
It continues to be operative even during the circumstances, and includes a reasonable time
time the goods are stored in a warehouse of the to see after his baggage and prepare for his
carrier at the place of destination until the departure. (La Mallorca v. CA, 17 SCRA 739 ;
consignee has bee advised of the arrival of the Abiotiz Shipping Corporation v. CA, 179 SCRA
goods and has had reasonable opportunity 95)
thereafter to remove them or otherwise dispose It is the duty of common carriers of
of them. (Art. 1738) passengers to stop their conveyances a
Delivery of goods to the custom authorities is reasonable length of time in order to afford
not delivery to the consignee. (Lu Do v. passengers an opportunity to enter, and they
Binamira, 101 Phil 120) are liable for injuries suffered from the sudden
starting up or jerking of their conveyances
while doing so. The duty which the carrier of
passengers owes to its patrons extends to
persons boarding the cars as well as to those
alighting therefrom (Dangwa Trans Co., Inc. vs.
CA 202 SCRA 574).
Presumption of negligence
Void stipulations
1. That the goods are transported at the risk Dispensing with or lessening the extraordinary
of the owner or shipper; responsibility of a common carrier for the
2. That carrier will not be liable for any loss, safety of passengers imposed by law by
destruction or deterioration of the goods; stipulation, by posting of notices, by
3. That the carrier need not observe any statements on tickets or otherwise. (Art. 1757)
diligence in the custody of the goods;
4. That the carrier shall exercise a degree of
diligence less than that of a good father of a
family over the movable transported;
5. That the carrier shall not be responsible for
the acts or omissions of his or its employees;
6. That the carrier’s liability for acts
committed by thieves or robbers who do not
act with grave or irresistible threat, violence or
force is dispensed with or diminished;
7. That the carrier is not responsible for the
loss, destruction or deterioration of the goods
on account of the defective condition of the
car, vehicle, ship or other equipment used in
the contract of carriage. (Art. 1745)
In United Airlines vs. Uy the two-year V. SALVAGE LAW (Act No. 2616)
prescriptive period was not applied where the
airline employed delaying tactics. SALVAGE
Two concepts:
RULE IN CASE OF VARIOUS SUCCESSIVE 1. Services one person renders to the owner
CARRIERS of a ship or goods, by his own labor,
1. Carriage of passengers preserving the goods or the ship which the
GENERAL RULE: Action is filed only against owner or those entrusted with the care of
the carrier in which the accident or delay them have either abandoned in distress at
occurred. sea, or are unable to protect or secure.
EXCEPTION: Agreement or contract whereby 2. Compensation allowed to persons by
the first carrier assumed liability for the whole whose voluntary assistance a ship at sea or
journey. her cargo or both have been saved in whole
2. Carriage of baggage or goods or in part from impending sea peril, or such
a. Passenger or consignor can file an property recovered from actual peril or loss,
action against the first carrier and as in cases of shipwreck, derelict or
the carrier in which the damage recapture.
occurred Requisites:
b. Passenger or consignee can file an 1. Valid object of salvage;
action against the last carrier and 2. Object must have been exposed to
the carrier in which the damage marine peril (not perils of the ship);
occurred. 3. Services rendered voluntarily
These carriers are jointly and severally (neither an existing duty nor out of a
liable. (Art. 30) pre-existing contract);
4. Services are successful, total or
A contract of international carriage by air, partial.
although performed by different carriers Subjects of Salvage:
under a series of airline tickets constitutes a 1. Ship itself;
single operation. Members of the 2. Jetsam – goods which are cast into the sea,
International Air Transportation Association and there sink and remain under water;
(IATA) are under a general pool partnership 3. Floatsam or Flotsam – goods which float
agreement wherein they act as agent of each upon the sea when cast overboard;
other in the issuance of tickets to contracted 4. Ligan or Lagan – goods cast into the sea
passengers to boost ticket sales worldwide tied to a buoy, so that they may be found
and at the same time provide passengers again by the owners (p.173, Judge Diaz).
easy access to airlines which are otherwise Persons who have no right to a reward
inaccessible in some parts of the world. for salvage:
(American Airlines vs. CA) 1. Crew of the vessel saved;
2. Person who commenced Salvage in spite
Under a general pool partnership of opposition of the Captain or his
agreement, the ticket-issuing airline is the representative;
principal in a contract of carriage while the 3. In accordance with Sec. 3 of the Salvage
endorsee-airline is the agent. The obligation Law, a person who fails to deliver a salvaged
of the former remained and did not cease vessel or cargo to the Collector of Customs.
even when the breach occurred not on its
own flight but on that of another airline which Derelict – a ship or her cargo which is
had undertaken to carry the passengers to abandoned and deserted at sea by those who
one of their destinations. (China Airlines vs. are in charge of it, without any hope of
Chiok) recovering it, or without any intention of
returning to it.
JURISDICTION
At the option of the plaintiff, the action for The intention of those in charge must be
damages may be filed in the: ascertained. If those in charge left with the
a. Court of domicile of the carrier; intention of returning, or of procuring
b. Court of its principal place of assistance, the property is not derelict, but if
business; they quitted the property with the intention of
c. Court where it has a place of business finally leaving it, it is derelict and a change of
through which the contract has been their intention and an attempt to return will
made; or not change its nature (Erlanger & Galinger vs.
d. Court of the place of destination. (Art. Swedish East Asiatic Co. Ltd.).
28(1))
NOTE: It is the passenger’s “ultimate If it is clear that the intention to return is
destination” not “an agreed stopping place” slight, the salvage which was done thereafter
that determines the country where suit is to is considered valid. (Notes and Cases on the
be filed. Law on Transportation and Public Utilities,
The forum of action provided in Art. 28(1) Aquino, T. & Hernando, R.P. 2004 ed. p. 616)
inefficient service;
CONTRACT OF TOWAGE 3. To protect and secure investments in
A contract whereby one vessel, usually public services;
motorized, pulls another, whether loaded or 4. To prevent ruinous competition.
not with merchandise, from one place to
another, for a compensation. It is a contract AUTHORITY TO OPERATE PUBLIC
for services rather than a contract of carriage. SERVICES
GENERAL RULE: No public service shall
operate without having been issued a
SALVAGE TOWAGE certificate of public convenience or a
certificate of public convenience and
Governed by special Governed by Civil
necessity.
law (Act No. 2616) Code on contract of
EXCEPTIONS:
lease
1. Warehouses;
Requires success, Success is not 2. Animal drawn vehicles and bancas
otherwise no required moved by oar or sail;
payment 3. Airships, except for the fixing of
Must be done with Only the consent of maximum rates for fare and freight;
the consent of the the tugboat owner 4. Radio companies, except for rates
captain/crewmen is needed fixing;
Vessel must be Vessel need not be 5. Public services owned or operated by
involved in an involved in an the government, except as to rates
accident accident fixing;
6. Ice plants; and
Fees distributed Fees belong to the 7. Public markets.
among crewmen tugboat owner
PUBLIC SERVICE
RULES ON SALVAGE REWARD A person who owns, operates, manages or
1. The reward is fixed by the RTC judge in controls in the Philippines for hire or
the absence of agreement or where the compensation, with general or limited
latter is excessive. (Sec. 9) clientele, whether permanent, occasional or
2. The reward should constitute a sufficient accidental, and done for general business
compensation for the outlay and effort of purposes, any common carrier or public
the salvors and should be liberal enough utility, ice plants, power and water supplies,
to offer an inducement to others to communication and similar public services.
render services in similar emergencies in (Sec. 13b, CA 146)
the future. A casual or incidental service devoid of
3. If sold (no claim being made within 3 public character and interest is not brought
months from publication), the proceeds, within the category. The question depends on
after deducting expenses and the such factors as the extent of services,
salvage claim, shall go to the owner; if whether such person or company has held
the latter does not claim it within 3 years, himself or itself out as ready to serve the
50% of the said proceeds shall go to the public or a portion of the public generally.
salvors, who shall divide it equitably, and (Luzon Stevedoring vs. PSC)
the other half to the government. (Secs.
11-12) NOTE: The Public Service Commission
4. If a vessel is the salvor, the reward shall created under the Public Service Law has
be distributed as follows: already been abolished under P.D. No. 1 and
a. 50% to the shipowner; other issuances. It has been replaced by the
b. 25% to the captain; and following government agencies: LTO; LTFRB;
ATO; BOE; NTC; NEA; ERB; NWRC; CAB; and
MIA.
c. 25% to the officers and crew in
proportion to their salaries. (Sec. 13)
CERTIFICATE OF CERTIFICATE OF
Taking passengers from a sinking ship, PUBLIC PUBLIC
without rendering any service in rescuing the CONVENIENCE CONVENIENCE
vessel, is not a salvage service, being a duty (CPC) AND NECESSITY
of humanity and not for reward. (CPCN)
PURPOSES:
1. To secure adequate, sustained
service for the public at the least
possible cost;
2. To protect the public against
unreasonable charges and poor,
An authorization An authorization meters and all expenses of
issued by the issued by the measuring investigation;
appropriate appropriate appliances; 4. Valuation of
government agency government agency 5. Issuance of properties of public
for the operation of for the operation of orders requiring utilities;
public services for public service for establishment or 5. Examination
which no franchise, which a prior maintenance of and test of
either municipal or franchise is required extension of measuring
legislative, is by law; e.g. facilities; appliances;
required by law, telephone and other 6. Revocation, or 6. Grant of special
e.g., common services. modification of CPC permits to make
carriers. or CPCN; extra or special trips
7. Suspension of in territories
CPC or CPCN, specified in the
except when it is certificate;
A CPC or a CPCN constitutes neither a
necessary to avoid 7. Uniform
franchise nor a contract, confers no property
serious and accounting system
right, and is a mere license or a privilege. The
irreparable damage and furnishing of
holder of said certificate does not acquire a
or inconvenience annual reports;
property right in the route covered thereby.
to the public or 8. Compelling
Nor does it confer upon the holder any
private interest, in compliance with the
proprietary right or interest or franchise in the
which case, a laws and
public highways. Revocation of this certificate
suspension not regulations.
deprives him of no vested right. New and
more than 30 days
additional burdens, alteration of the
may be ordered,
certificate, or even revocation or annulment
prior to the
thereof is reserved to the State. (Luque vs.
hearing. (Soriano v.
Villegas, 30 SCRA 408)
Medina, 164 SCRA
36)
It is a “property” and has a considerable
value and can be the subject of sale or
attachment. (Cogeo-Cubao Operators and UNLAWFUL ACTS OF PUBLIC UTILITY
Drivers Assn. vs. CA, 207 SCRA 343, COMPANIES
Raymundo vs. Luneta Motor Co.) 1. Engagement in public service business
without first securing the proper
REQUREMENTS FOR GRANTING CPC OR certificate;
CPCN 2. Providing or maintaining unsafe,
1. Applicant must be a citizen of the improper or inadequate service as
Philippines or a corporation or entity 60% determined by the proper authority;
of the capital of which is owned by such 3. Committing any act of unreasonable and
citizens; unjust preferential treatment to any
2. Applicant must prove public necessity; particular person, corporation or entity as
3. Applicant must prove that the operation determined by the proper authority;
of the public service proposed and the 4. Refusing or neglecting to carry public
authorization to do business will promote mail upon request. (Secs. 18 and 19)
the public interest on a proper and
suitable manner; ACTS REQUIRING PRIOR APPROVAL
4. Applicant must have sufficient financial 1. Establish and maintain individual or joint
capability to undertake the proposed rates;
services and meeting the responsibilities 2. Establish and operate new units;
incident to its operation. 3. Issue free tickets;
4. Issue any stock or stock certificates
representing an increase of capital;
5. Capitalize any franchise in excess of the
POWERS POWERS
amount actually paid to the Government;
REQUIRING EXERCISABLE
6. Sell, alienate, mortgage or lease
PRIOR NOTICE WITHOUT PRIOR
property, certificates or franchise.
AND HEARING NOTICE AND
HEARING
Under Sec. 20(g) of C.A. No. 146, the sale,
etc. may be negotiated and completed before
1. Issuance of 1. Investigation the approval by the proper authority. Its
CPC or CPCN; any matter approval is not a condition precedent to the
2. Fixing of rates, concerning public validity of the contract. The approval is
tolls, and charges; service; necessary only to protect public interest.
3. Setting up of 2. Requiring
standards and operators to furnish PRIOR OPERATOR/OLD OPERATOR RULE
classifications; safe, adequate, and The rule allowing an existing franchised
4. Establishment proper service; operator to invoke a preferential right within
of rules to secure 3. Requiring public the authorized territory as long as he renders
accuracy of all services to pay satisfactory and economical service.
The policy is not to issue a certificate to a inexistent under Art. 1409, Civil Code.
second operator to cover the same field and Effects:
in competition with a first operator who is 1. The transfer, sale, lease or assignment of
rendering sufficient, adequate and the privilege granted is valid between the
satisfactory service. The prior operator must contracting parties but not upon the
first be given an opportunity to improve its public or third persons. (Gelisan vs.
service, if inadequate or deficient. Alday, 154 SCRA 388)
Purpose: To prevent ruinous and wasteful
competition in order that the interests of the
public would be conserved and preserved.
KABIT SYSTEM
A system whereby a person who has been
granted a certificate of public convenience
allows other persons who own motor vehicles
to operate under such license, for a fee or
percentage of such earnings. It is void and