De Guzman vs. Court of Appeals: 612 Supreme Court Reports Annotated

8/2/2021 SUPREME COURT REPORTS ANOTATED VOLUME 168 8/2/2021 SUPREME COURT REPORTS ANOTATED VOLUME 168
Same; Same; Same; The concept of “common carrier” under

Art. 1732 coincides with the notion of “Public Service” under the
Public Service Act (CA No. 1416).—So understood, the concept of
“common carrier” under Article 1732 may be seen to coincide
neatly with the notion of “public service,” under the Public Service
612 SUPREME COURT REPORTS ANNOTATED Act (Commonwealth Act No. 1416, as amended) which at least
partially supplements the law on common carriers set forth in the
De Guzman vs. Court of Appeals Civil Code. Under Section 13, paragraph (b) of the Public Service
*
Act, “public service” includes: “x x x every person that now or
No. L-47822. December 22, 1988. hereafter may own, operate, manage, or control in the
Philippines, for hire or compensation, with general or limited
PEDRO DE GUZMAN, petitioner, vs. COURT OF clientele, whether permanent, occasional or accidental, and done
APPEALS and ERNESTO CENDAÑA, respondents. for general business purposes, any common carrier, railroad, street
railway, traction railway, subway motor vehicle, either for freight
or passenger, or both, with or without fixed route and whatever
Common Carriers; Definition of; Art. 1732 of the Civil Code
may be its classification, freight or carrier service of any class,
makes no distinctions between a person or enterprise offering
express service, steamboat, or steamship line, pontines, ferries
transportation service on a regular or scheduled basis and such
and water craft, engaged in the transportation of passengers or
service on an occasional, episodic or unscheduled basis.—The Civil
freight or both, shipyard, marine repair shop, wharf or dock, ice
Code defines “common carriers” in the following terms: “Article
plant, ice-refrigeration plant, canal, irrigation system, gas,
1732. Common carriers are persons, corporations, firms, or
electric light, heat and power, water supply and power petroleum,
associations engaged in the business of carrying or transporting
sewerage system, wire or wireless communications systems, wire
passengers or goods or both, by land, water, or air for
or wireless broadcasting stations and other similar public
compensation, offering their services to the public.” The above
services. x x x.”
article makes no distinction between one whose principal
business activity is the carrying of persons or goods or both, and
Same; Same; Same; Same; A certificate of public convenience
one who does such carrying only as an ancillary activity (in local
is not a requisite for the incurring of liability under the Civil Code
idiom, as “a sideline”). Article 1732 also carefully avoids making
provisions governing common carriers.—The Court of Appeals
any distinction between a person or enterprise offering
referred to the fact that private respondent held no certificate of
transportation service on a regular or scheduled basis and one
public convenience, and concluded he was not a common carrier.
offering such service on an occasional, episodic or unscheduled
This is palpable error. A certificate of public convenience is not a
basis. Neither does Article 1732 distinguish between a carrier
requisite for the incurring of liability under the Civil Code
offering its services to the “general public,” i.e., the general
provisions governing common carriers. That liability arises the
community or population, and one who offers services or solicits
moment a person or firm acts as a common carrier, without
business only from a narrow segment of the general population.
regard to whether or not such carrier has also complied with the
We think that Article 1733 deliberately refrained from making
requirements of the applicable regulatory statute and
such distinctions.
implementing regulations and has been granted a certificate of
public convenience or other franchise. To exempt private
________________ respondent from the liabilities of a common carrier because he
has not secured the necessary certificate of public convenience,
* THIRD DIVISION.
would be offensive to sound public policy; that would be to reward
private respondent precisely for failing to comply with applicable
613 statutory requirements. The business of a common carrier
impinges directly and intimately upon the safety and well being
and property of those members of the general community who
VOL. 168, DECEMBER 22, 1988 613 happen to deal with such carrier. The law imposes duties and
De Guzman vs. Court of Appeals

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liabilities upon common carriers for the safety and protection of negligently. This presumption, however, may be overthrown by
those who utilize their proof of extraordinary diligence on the part of private respondent.
614 Same; Same; Same; Same; Same; Under Art. 1745(6), a

common carrier is held responsible even for acts of strangers like
thieves or robbers except where such thieves or robbers acted “with
grave or irresistible threat, violence or force.”—As noted earlier,
614 SUPREME COURT REPORTS ANNOTATED
the duty of ex-
615
services and the law cannot allow a common carrier to render

such duties and liabilities merely facultative by simply failing to
obtain the necessary permits and authorizations. VOL. 168, DECEMBER 22, 1988 615
Same; Same; Same; Liability of common carriers in case of De Guzman vs. Court of Appeals
loss, destruction or deterioration or destruction of goods they carry;
Extraordinary diligence, required; Exceptions.—Common carriers, traordinary diligence in the vigilance over goods is, under Article
“by the nature of their business and for reasons of public policy,” 1733, given additional specification not only by Articles 1734 and
are held to a very high degree of care and diligence 1735 but also by Article 1745, numbers 4, 5 and 6. Article 1745
(“extraordinary diligence”) in the carriage of goods as well as of provides in relevant part: “Any of the following or similar
passengers. The specific import of extraordinary diligence in the stipulations shall be considered unreasonable, unjust and
care of goods transported by a common carrier is, according to contrary to public policy: xxx xxx xxx (5) that the common carrier
Article 1733, “further expressed in Articles 1734, 1735 and 1745, shall not be responsible for the acts or omissions of his or its
numbers 5, 6 and 7” of the Civil Code. Article 1734 establishes the employees; (6) that the common carrier’s liability for acts
general rule that common carriers are responsible for the loss, committed by thieves, or of robbers who do not act with grave or
destruction or deterioration of the goods which they carry, “unless irresistible threat, violence or force, is dispensed with or
the same is due to any of the following causes only: (1) Flood, diminished; and (7) that the common carrier shall not responsible
storm, earthquake, lightning, or other natural disaster or for the loss, destruction or deterioration of goods on account of the
calamity; (2) Act of the public enemy in war, whether defective condition of the car, vehicle, ship, airplane or other
international or civil; (3) Act or omission of the shipper or owner equipment used in the contract of carriage.” Under Article 1745
of the goods; (4) The character of the goods or defects in the (6) above, a common carrier is held responsible and will not be
packing or in the containers; and (5) Order or act of competent allowed to divest or to diminish such responsibility—even for acts
public authority.” It is important to point out that the above list of of strangers like thieves or robbers, except where such thieves or
causes of loss, destruction or deterioration which exempt the robbers in fact acted “with grave or irresistible threat, violence or
common carrier for responsibility therefor, is a closed list. Causes force.” We believe and so hold that the limits of the duty of
falling outside the foregoing list, even if they appear to constitute extraordinary diligence in the vigilance over the goods carried are
a species of force majeure, fall within the scope of Article 1735. reached where the goods are lost as a result of a robbery which is
attended by “grave or irresistible threat, violence or force.”
Same; Same; Same; Same; Same; The hijacking of the carriers
truck does not fall within any of the five (5) categories of exempting Same; Same; Same; Same; Same; Common carriers are not
causes in Art. 1734.—Applying the above-quoted Articles 1734 made absolute insurers against all risks of travel and of transport
and 1735, we note firstly that the specific cause alleged in the of goods and are not liable for fortuitous events; Case at bar.—In
instant case—the hijacking of the carrier’s truck—does not fall these circumstances, we hold that the occurrence of the loss must
within any of the five (5) categories of exempting causes listed in reasonably be regarded as quite beyond the control of the common
Article 1734. It would follow, therefore, that the hijacking of the carrier and properly regarded as a fortuitous event. It is
carrier’s vehicle must be dealt with under the provisions of Article necessary to recall that even common carriers are not made
1735, in other words, that the private respondent as common absolute insurers against all risks of travel and of transport of
carrier is presumed to have been at fault or to have acted goods, and are not held liable for acts or events which cannot be
foreseen or are inevitable, provided that they shall have complied Tarlac, by armed men who took with them the truck, its
with the rigorous standard of extraordinary diligence. We, driver, his helper and the cargo.
therefore, agree with the result reached by the Court of Appeals On 6 January 1971, petitioner commenced action
that private respondent Cendaña is not liable for the value of the against private respondent in the Court of First Instance of
undelivered merchandise which was lost because of an event Pangasinan, demanding payment of P22,150.00, the
entirely beyond private respondent’s control. claimed value of the lost merchandise, plus damages and
attorney’s fees. Petitioner argued that private respondent,
PETITION for certiorari to review the decision of the Court being a common carrier, and having failed to exercise the
of Appeals. extraordinary diligence required of him by the law, should
be held liable for the value of the undelivered goods.
The facts are stated in the opinion of the Court.
In his Answer, private respondent denied that he was a
Vicente D. Millora for petitioner.
common carrier and argued that he could not be held
Jacinto Callanta for private respondent.
responsible for the value of the lost goods, such loss having
616 been due to
617
De Guzman vs. Court of Appeals VOL. 168, DECEMBER 22, 1988 617
FELICIANO, J.:
force majeure.
Respondent Ernesto Cendaña, a junk dealer, was engaged
On 10 December 1975, the trial court rendered a
in buying up used bottles and scrap metal in Pangasinan. 1
Upon gathering sufficient quantities of such scrap Decision finding private respondent to be a common
material, respondent would bring such material to Manila carrier and holding him liable for the value of the
for resale. He utilized two (2) six-wheeler trucks which he undelivered goods (P22,150.00) as well as for P4,000.00 as
damages and P2,000.00 as attorney’s fees.
owned for hauling the material to Manila. On the return
trip to Pangasinan, respondent would load his vehicles On appeal before the Court of Appeals, respondent
with cargo which various merchants wanted delivered to urged that the trial court had erred in considering him a
differing establishments in Pangasinan. For that service, common carrier; in finding that he had habitually offered
trucking services to the public; in not exempting him from
respondent charged freight rates which were commonly
liability on the ground of force majeure; and in ordering
lower than regular commercial rates.
Sometime in November 1970, petitioner Pedro de him to pay damages and attorney’s fees.
Guzman, a merchant and authorized dealer of General The Court of Appeals reversed the judgment of the trial
Milk Company (Philippines), Inc. in Urdaneta, Pangasinan, court and held that respondent had been engaged in
transporting return loads of freight “as a casual occupation
contracted with respondent for the hauling of 750 cartons
—a sideline to his scrap iron business” and not as a
of Liberty filled milk from a warehouse of General Milk in
Makati, Rizal, to petitioner’s establishment in Urdaneta on common carrier.
or before 4 December 1970. Accordingly, on 1 December Petitioner came to this Court by way of a Petition for
1970, respondent loaded in Makati the merchandise on to Review assigning as errors the following conclusions of the
Court of Appeals:
his trucks: 150 cartons were loaded on a truck driven by
respondent himself; while 600 cartons were placed on board
1. that private respondent was not a common carrier;
the other truck which was driven by Manuel Estrada,
respondent’s driver and employee. 2. that the hijacking of respondent’s truck was force
majeure; and
Only 150 boxes of Liberty filled milk were delivered to
petitioner. The other 600 boxes never reached petitioner, 3. that respondent was not liable for the value of the
since the truck which carried these boxes was hijacked undelivered cargo. (Rollo, p. 111)
somewhere along the MacArthur Highway in Paniqui,

We consider first the issue of whether or not private vehicle, either for freight or passenger, or both, with or without
respondent Ernesto Cendaña may, under the facts earlier fixed route and whatever may be its classification, freight or
set forth, be properly characterized as a common carrier. carrier service of any class, express service, steamboat, or
The Civil Code defines “common carriers” in the following steamship line, pontines, ferries and water craft, engaged in the
terms: transportation of passengers or freight or both, shipyard, marine
repair shop, wharf or dock, ice plant, ice-refrigeration plant,
“Article 1732. Common carriers are persons, corporations, firms canal, irrigation system, gas, electric light, heat and power, water
or associations engaged in the business of carrying or supply and power petroleum, sewerage system, wire or wireless
transporting passengers or goods or both, by land, water, or air communications systems, wire or wireless broadcasting stations
for compensation, offering their services to the public.” and other similar public services. x x x.” (Italics supplied)
The above article makes no distinction between one whose It appears to the Court that private respondent is properly
principal business activity is the carrying of persons or characterized as a common carrier even though he merely
goods or both, and one who does such carrying only as an “back-hauled” goods for other merchants from Manila to
ancillary activity (in local idiom, as “a sideline”). Article Pangasinan, although such backhauling was done on a
1732 also periodic or occasional rather than regular or scheduled
manner, and even though private respondent’s principal
_______________ occupation was not the carriage of goods for others. There
is no dispute that private respondent charged his
1 Rollo, p. 14.
customers a fee for hauling their goods;
618
619
618 SUPREME COURT REPORTS ANNOTATED VOL. 168, DECEMBER 22, 1988 619
De Guzman vs. Court of Appeals De Guzman vs. Court of Appeals
carefully avoids making any distinction between a person that that fee frequently fell below commercial freight rates
or enterprise offering transportation service on a regular or is not relevant here.
scheduled basis and one offering such service on an The Court of Appeals referred to the fact that private
occasional, episodic or unscheduled basis. Neither does respondent held no certificate of public convenience, and
Article 1732 distinguish between a carrier offering its concluded he was not a common carrier. This is palpable
services to the “general public,” i.e., the general community error. A certificate of public convenience is not a requisite
or population, and one who offers services or solicits for the incurring of liability under the Civil Code provisions
business only from a narrow segment of the general governing common carriers. That liability arises the
population. We think that Article 1733 deliberately moment a person or firm acts as a common carrier, without
refrained from making such distinctions. regard to whether or not such carrier has also complied
So understood, the concept of “common carrier” under with the requirements of the applicable regulatory statute
Article 1732 may be seen to coincide neatly with the notion and implementing regulations and has been granted a
of “public service,” under the Public Service Act certificate of public convenience or other franchise. To
(Commonwealth Act No. 1416, as amended) which at least exempt private respondent from the liabilities of a common
partially supplements the law on common carriers set forth carrier because he has not secured the necessary certificate
in the Civil Code. Under Section 13, paragraph (b) of the of public convenience, would be offensive to sound public
Public Service Act, “public service” includes: policy; that would be to reward private respondent
“x x x every person that now or hereafter may own, operate, precisely for failing to comply with applicable statutory
manage, or control in the Philippines, for hire or compensation, requirements. The business of a common carrier impinges
with general or limited clientele, whether permanent, occasional or directly and intimately upon the safety and well being and
accidental, and done for general business purposes, any common property of those members of the general community who
carrier, railroad, street railway, traction railway, subway motor happen to deal with such carrier. The law imposes duties
and liabilities upon common carriers for the safety and deteriorated, common carriers are presumed to have been at fault
protection of those who utilize their services and the law or to have acted negligently, unless they prove that they observed
cannot allow a common carrier to render such duties and extraordinary diligence as required in Article 1733.” (Italics
liabilities merely facultative by simply failing to obtain the supplied)
necessary permits and authorizations.
We turn then to the liability of private respondent as a Applying the above-quoted Articles 1734 and 1735, we note
common carrier. firstly that the specific cause alleged in the instant case—
Common carriers, “by the nature of their business and the hijacking of the carrier’s truck—does not fall within
2
for reasons of public policy,” are held to a very high degree any of the five (5) categories of exempting causes listed in
of care and diligence (“extraordinary diligence”) in the Article 1734. It would follow, therefore, that the hijacking
carriage of goods as well as of passengers. The specific of the carrier’s vehicle must be dealt with under the
import of extraordinary diligence in the care of goods provisions of Article 1735, in other words, that the private
transported by a common carrier is, according to Article respondent as common carrier is presumed to have been at
1733, “further expressed in Articles 1734, 1735 and 1745, fault or to have acted negligently. This presumption,
numbers 5, 6 and 7” of the Civil Code. however, may be overthrown by proof of extraordinary
diligence on the part of private respondent.
Petitioner insists that private respondent had not
_______________
observed extraordinary diligence in the care of petitioner’s
2 Article 1733, Civil Code. goods. Petitioner argues that in the circumstances of this
case, private respondent should have hired a security
620 guard presumably to
621
VOL. 168, DECEMBER 22, 1988 621
Article 1734 establishes the general rule that common
carriers are responsible for the loss, destruction or
deterioration of the goods which they carry, “unless the ride with the truck carrying the 600 cartons of Liberty
same is due to any of the following causes only: filled milk. We do not believe, however, that in the instant
case, the standard of extraordinary diligence required
(1) Flood, storm, earthquake, lightning, or other private respondent to retain a security guard to ride with
natural disaster or calamity; the truck and to engage brigands in a firefight at the risk of
(2) Act of the public enemy in war, whether his own life and the lives of the driver and his helper.
international or civil; The precise issue that we address here relates to the
(3) Act or omission of the shipper or owner of the goods; specific requirements of the duty of extraordinary diligence
in the vigilance over the goods carried in the specific
(4) The character of the goods or defects in the packing
context of hijacking or armed robbery.
or in the containers; and
As noted earlier, the duty of extraordinary diligence in
(5) Order or act of competent public authority.” the vigilance over goods is, under Article 1733, given
additional specification not only by Articles 1734 and 1735
It is important to point out that the above list of causes of but also by Article 1745, numbers 4, 5 and 6, Article 1745
loss, destruction or deterioration which exempt the provides in relevant part:
common carrier for responsibility therefor, is a closed list.
Causes falling outside the foregoing list, even if they “Any of the following or similar stipulations shall be considered
appear to constitute a species of force majeure, fall within unreasonable, unjust and contrary to public policy:
the scope of Article 1735, which provides as follows: x x x x x x x x x
“In all cases other than those mentioned in numbers 1, 2, 3, 4 and (5) that the common carrier shall not be responsible for the
5 of the preceding article, if the goods are lost, destroyed or acts or omissions of his or its employees;
(6) that the common carrier’s liability for acts committed by In these circumstances, we hold that the occurrence of
thieves, or of robbers who do not act with grave or the loss must reasonably be regarded as quite beyond the
irresistible threat, violence or force, is dispensed with or control of the common carrier and properly regarded as a
diminished; and fortuitous event. It is necessary to recall that even common
(7) that the common carrier shall not responsible for the loss, carriers are not made absolute insurers against all risks of
destruction or deterioration of goods on account of the travel and of transport of goods, and are not held liable for
defective condition of the car, vehicle, ship, airplane or acts or events which cannot be foreseen or are inevitable,
other equipment used in the contract of carriage.” (Italics provided that they shall have complied with the rigorous
supplied) standard of extraordinary diligence.
We, therefore, agree with the result reached by the
Under Article 1745 (6) above, a common carrier is held Court of Appeals that private respondent Cendaña is not
responsible—and will not be allowed to divest or to liable for the value of the undelivered merchandise which
diminish such responsibility—even for acts of strangers was lost because of an event entirely beyond private
like thieves or robbers, except where such thieves or respondent’s control.
robbers in fact acted “with grave or irresistible threat, ACCORDINGLY, the Petition for Review on Certiorari
violence or force.” We believe and so hold that the limits of is hereby DENIED and the Decision of the Court of
the duty of extraordinary diligence in the vigilance over the Appeals dated 3 August 1977 is AFFIRMED. No
goods carried are reached where the goods are lost as a pronouncement as to costs.
result of a robbery which is attended by “grave or
irresistible threat, violence or force.” _______________
In the instant case, armed men held up the second truck
owned by private respondent which carried petitioner’s
3 Rollo, p. 22.
cargo. The record shows that an information for robbery in

4 The evidence of the prosecution did not show that more than three (3)
band was of the five (5) hold-uppers were armed. Thus, the existence of a “band”
within the technical meaning of Article 306 of the Revised Penal Code,
622 was not affirmatively proved by the prosecution.
623
VOL. 168, DECEMBER 22, 1988 623
Valenzuela vs. Court of Appeals
filed in the Court of First Instance of Tarlac, Branch 2, in
Criminal Case No. 198 entitled “People of the Philippines v.
Felipe Boncorno, Napoleon Presno, Armando Mesina, SO ORDERED.
Oscar Oria and one John Doe.” There, the accused were
Fernan (C.J.), Gutierrez, Jr., Bidin and Cortés, JJ.,
charged with willfully and unlawfully taking and carrying
concur.
away with them the second truck, driven by Manuel
Estrada and loaded with the 600 cartons of Liberty filled Petition denied. Decision affirmed.
milk destined for delivery at petitioner’s store in Urdaneta,
Pangasinan. The decision of the trial court shows that the Notes.—Right of reimbursement of company held liable
accused 3acted with grave, if not irresistible, threat, violence for damages against the owner/operator of ferry boat for
or force. Three (3) of the five (5) hold-uppers were armed actual negligence for drawing passengers. (Sarkies Tours
with firearms. The robbers not only took away the truck Phils, Inc. vs. IAC, 124 SCRA 588.)
and its cargo but also kidnapped the driver and his helper, The owner of a vessel is liable in damages arising from
detaining them for several days and later releasing them in the act of its captain in by-passing a pre-scheduled port of
another province (in Zambales). The hijacked truck was call. (Sweet Lines vs. Court of Appeals, 121 SCRA 769.)
subsequently found by the police in Quezon City. The Court
of First Instance convicted 4all the accused of robbery, ———o0o———
though not of robbery in band.
8/2/2021 SUPREME COURT REPORTS ANOTATED VOLUME 168
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8/2/2021 SUPREME COURT REPORTS ANOTATED VOLUME 168 8/2/2021 SUPREME COURT REPORTS ANOTATED VOLUME 168

Same; Same; Same; The concept of “common carrier” under

De Guzman vs. Court of Appeals

614 Same; Same; Same; Same; Same; Under Art. 1745(6), a

services and the law cannot allow a common carrier to render

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cargo. The record shows that an information for robbery in

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