COMMERCIAL LAW EXC:

-that branch of private law which regulates the (a) Cognition Theory
juridical relations arising from commercial acts and -In perfection by correspondence, the
according to which the questions or controversies which applicable rule is the Cognition Theory, under which the
may arise therefrom are resolved. contract is perfected the moment the offeror learns
about the acceptance of his offer by the offeree.
Applicable Laws -applies to all consensual that are governed by
(a) Code of Commerce Commercial Laws.
-this law was extended to the Philippines by
Royal Decree of August 6, 1988. It took effect on Dec 1, (b) Manifestation Theory
1888. However, with the passage of NCC, only the following - Art 54 of the Code of Commerce upholds the
are still governed by the Code of Commerce. Manifestation Theory, under which the contract is
i. Merchants, commercial Registries, Book of perfected the moment the acceptance of the offer is
Merchants, General Provisions on Commercial “manifested” or made.
Contracts; -applies to all contracts that are still governed
ii. Joint Accounts; by Code of Commerce.
iii. Transfer of Non-negotiable Credits;
iv. Overland Transportation; (c) Others
v. Letters of Credit;
vi. Maritime Commerce i. Perfected by Delivery – real contract like the
contract of carriage proper
(b) Civil Code ii. Perfected through execution of formalities-
-repealed the provisions of the Code of for formal contracts
Commerce on:
i. Sales,
ii. Partnership,
iii. Agency,
iv. Loan,
v. Guaranty, and
vi. Deposit

-likewise, it is the primary governing law on Common

Carriers

(c) Special Laws

-includes but are not limited to the following:
i. Corporation Code of the Philippines (B.P Blg 68);
ii. Negotiable Instruments Laws(Act No. 2031);
iii. Insurance Code of the Philippines (R.A No.
10607);
iv. Financial Rehabilitation and Insolvency Act of
2010 (RA No. 10142);
v. Securities Regulation Code;
vi. General Banking Law;
vii. New Central Bank Act;
viii. Warehouse Receipts law;
ix. Trust Receipts Law;
x. Business Name Law;
xi. Chattel Mortgage law;
xii. Public Service Law;
xiii. Intellectual Property Code.

COMMERCIAL CONTRACTS
-Contracts that are governed by the Code of
Commerce.

Concept and Formalities

GR: If there is no law specifically requiring
certain formalities, Commercial Contracts are Valid in
whatever form they appear
EXC: Contracts that are EXPRESSLY required to be
in writing under the Code of Commerce are:
(1) Letters of Credit;
(2) Loans on Bottomry and Respondentia;
(3) Charter parties

Perfection
GR: Perfected upon meeting of the minds with
respect to the object and the consideration.
 LAWS ON TRANSPORTATION
AND PUBLIC UTILITIES

A. GENERAL CONCEPTS

CONCEPT OF COMMON CARRIERS

Art 1732 NCC. Common carriers are 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.

Common Carriers
-one that holds himself out as ready to engage in
the transportation of goods for hire as a public employment
and not casual occupation. (De Guzman vs CA)
-Art 1732NCC avoids distinction between a person
or an enterprise offering transportation on regular and
scheduled basis and one offering transportation on regular
and scheduled basis and one offering transportation service
on occasional, episodic, and unscheduled basis. Neither
does the law distinguish between a carrier offering its
services for the general public, that is, the general
community or population and one who offers business only
from a narrow segment of the general population. (De
Guzman vs CA)

Tests
(a) TRUE TEST
-whether the undertaking is part of the activity
engaged in by the carrier that he has held out to the
general public as his business or occupation. (Sps. Perena
vs Sps. Nicolas)
(b) Test in First Phil Industrial Corp vs CA
-the test consist of the following:
(i) He must be engaged in the business of carrying
goods for others as a public employment, and must hold
himself out as ready to engage in the transportation of
goods for persons generally as a business and not as a
casual occupation;
(ii) He must undertake to carry goods of the kind
to which his business is confined;
(iii) He must undertake to carry by the method
by which his business is conducted and over his established
roads; and
(iv) the Transportation must be for HIRE.

*** ii, and iii are not indispensable.

(c) CHARTER PARTY

Bareboat or - a charter party where the
Demise Charter charterer mans the vessel with his
own people and becomes, in effect,
the owner for the voyage or service
stipulated.
-transforms the common carrier into
a private carrier
Contract of Involves the use of shippings pace
affeightment leased by the owner in part or as a
whole, to carry goods for others
-does not transform the common
carrier into a private carrier
(Caltex vs Sulpicio Lines)

(i)