Case Philippine American General Insurance Company v.

PKS
Citation Shipping Company, G.R. No. 149038, 09 April 2003, (401
SCRA 222)

Facts Davao Union Marketing Corporation (DUMC) contracted the

services of respondent PKS Shipping Company (PKS
Shipping) for the shipment to Tacloban City of seventy-five
thousand (75,000) bags of cement worth Three Million Three
Hundred Seventy-Five Thousand Pesos (P3,375,000.00).

The goods were loaded aboard the dumb barge Limar I

belonging to PKS Shipping. The ship sank with the entire
cargo.

Philippine American General Insurance Company

(Philamgen), as the insurer immediately paid the claim of
DUMC subrogating it to the right to claim for damages. The
RTC dismissed the complaint against PKS Shipping, ruling
that the sinking is due to fortuitious event (Typhon Apiang).

Court of Appeals affirmed in toto the decision of RTC and

further ruled that the same is not a common carrier. It averred
that the peculiar method of the shipping company’s carrying
goods for others was not generally held out as a business but
as a casual occupation.

Issue Whether or not PKS shipping is a common carrier liable to the

cargo

Ruling Yes. The high court granted the petition.

PKS Shipping is engaged in the business of carrying goods for

others, although for a limited clientele, undertaking to carry
such goods for a fee. The regularity of its activities in this area
indicates more than just a casual activity on its part. Neither
can the concept of a common carrier change merely because
individual contracts are executed or entered into with patrons
of the carrier. Such restrictive interpretation would make it
 easy for a common carrier to escape liability by the simple
expedient of entering into those distinct agreements with
clients.

It was already enunciated in De Guzman that Art. 1732 of the

New Civil Code makes no distinction between one whose
principal business activity is the carrying of persons or goods
or both, and one who does such carrying only as an ancillary
activity (in local idiom, as `a sideline’). Article 1732 also
carefully avoids making any distinction between a person or
enterprise offering transportation service on a regular or
scheduled basis and one offering such service on an
occasional, episodic or unscheduled basis. Neither does
Article 1732 distinguish between a carrier offering its services
to the `general public,’ i.e., the general community or
population, and one who offers services or solicits business
only from a narrow segment of the general population. The
Court opined that Article 1732 deliberately refrained from
making such distinctions.

However, as a common carrier PKS shipping could not have

done something to save the ship from sinking since it is clear
from the findings of the CA that vessel was suddenly tossed by
waves of extraordinary height of six (6) to eight (8) feet and
buffeted by strong winds of 1.5 knots resulting in the entry of
water into the barge’s hatches. Further, the official Certificate
of Inspection of the barge issued by the Philippine Coastguard
and the Coastwise Load Line Certificate would attest to the
seaworthiness of Limar I and should strengthen the factual
findings of the appellate court.

The petition is denied. PKS shipping is not liable.

Key Much of the distinction between a "common or public carrier"

concept/s and a "private or special carrier" lies in the character of the
to business, such that if the undertaking is an isolated
remembe transaction, not a part of the business or occupation, and the
r carrier does not hold itself out to carry the goods for the
general public or to a limited clientele, although involving the
carriage of goods for a fee, the person or corporation
providing such service could very well be just a private carrier.
A typical case is that of a charter party which includes both the
vessel and its crew, such as in a bareboat or demise, where the
charterer obtains the use and service of all or some part of a
ship for a period of time or a voyage or voyages and gets the
control of the vessel and its crew.