CONTRACT OF

CARRIAGE
COMMONWEALTH ACT No. 65

IN ACT TO DECLARE THAT PUBLIC ACT NUMBERED FIVE

HUNDRED AND TWENTY-ONE, KNOWN AS "CARRIAGE OF
GOODS BY SEA ACT," ENACTED BY THE SEVENTY-FOURTH
CONGRESS OF THE UNITED STATES, BE ACCEPTED, AS IT IS
HEREBY ACCEPTED BY THE NATIONAL ASSEMBLY
CONTRACT OF CARRIAGE
A “contract of carriage” is a
negotiated contract not subject to a
tariff that is between the carrier and
shipper for the transportation of
cargo.

The written contract between a

shipper and carrier sets forth the
terms, conditions, and obligations of
each party with respect to the
carriage of the particular goods.
Contracted carriers may choose if and
when to provide service.
 COMMON TYPES OF CONTRACTS OF CARRIAGE
INCLUDE THE FOLLOWING:
1. BILL OF LADING
A bill of lading (BOL or B/L) is issued to a shipper detailing the method and path of a
shipment. It is a contract for the movement of the goods, and serves as a receipt for the
cargo and can act as proof of ownership of the goods being transported.
Ocean shipments use original or express bills of lading while Air shipments use air
waybills.

2. SEA WAYBILL
Sea Waybill is a transport contract contract of carriage) - the same as a Bill of Lading
A Sea Waybill, however, is not needed for cargo delivery and is only issued as a cargo
receipt. A Sea Waybill is not negotiable and cannot be assigned to a third party.
3. AIR WAYBILL
Air waybills are the freight documents associated with air
shipments.
An air waybill (AWD) is a non-negotiable document issued by a
carrier when goods are transported by air.
An air waybill acts as delivery instructions, a contract of
carriage and a cargo receipt for airfreight.

4. CHARTER PARTY
Charter party, contract by which the owner of a ship lend it to
others for use in transporting a cargo. The shipowner continues to
control the navigation and management of the vessel, but its
carrying capacity is engaged by the charterer.
CARRIAGE OF PASSENGERS
the parties here are the common carrier and the passenger. A passenger is
one who travels in a public conveyance by virtue of contract, express or
implied, with the carrier subject to payment of fare or an equivalent thereof.
i. Gratuitous or reduced fare – a passenger is still considered as
such even if he is being carried gratuitously or under a reduced
fair. Art. 1758 of Civil Code: when a passenger is carried
gratuitously, a stipulation limiting the common carrier’s liability
for negligence is valid.
ii. It is the person whose contractual right has been invaded
who must bring every action based on contract.
iii. Only the operator can breach the contract of carriage. A complaint for
breach of a contract of carriage should be dismissed against the employee who
was driving the bus because the parties to the contract of carriage are only the
passenger and the bus owner/operator.
iv. However, whether or not there is a written agreement, the carrier owes a
duty of extraordinary diligence directly to the passengers.
There are 2 types of contracts of carriage of passengers.
1.Contract to Carry – an agreement to carry the passenger at some future
date. This contract is consensual and is therefore perfected by mere
consent.
2.Contract of Carriage or of Common Carriage itself – should be
considered a real contract for not until the facilities of the carrier are
actually used can the carrier be said to have already assumed the
obligation of the carrier.
CARRIAGE OF GOODS
the parties are the shipper and the carrier. The
shipper is the person who delivers the goods to the
carrier for transportation. The shipper is the person
who pays the consideration on whose behalf payment
is made.

i. Consignee – the person to whom the goods are

delivered. May be a third person who is not actually a
party to the contract of carriage.
ii. When Consignee is bound by Contract – The consignee is bound by
the terms and conditions of the bill of lading where it was established
that he accepted the same and is trying to enforce the agreement. They
can be bound by the stipulations of the bill of lading contract by reason
of either:

1. the relationship of agency between the consignee and the

shipper/consignor;
2. the unequivocal acceptance of the BOL delivered to the
consignee, with full knowledge of its contents; or
3. availment of the stipulation pour autrui, i., when the consignee,
a third person, demands before the carrier the fulfillment of the
stipulation made by the consignor/shipper in the consignee’s favor,
specifically the delivery of the goods/cargoes shipped.
ELEMENTS
the essential requisites of a valid contract are: 1) consent, 2) object, and
3) consideration.

In a contract of carriage, consent is given by the carrier on one hand

and the passenger or the shipper as the case may be. The consideration for
the carrier is the fare or freight to be paid by the passenger or shipper. The
consideration for the passenger or the shipper is the promise to transport
the passenger or the goods. The object of the contract is the prestation
which id the transportation of the passenger or goods from one place to
another.
 AIR PASSENGER BILL
OF RIGHTS
Based on Joint DOTC-DTI Administrative Order No. 1
Series of 2012 or the Air Passenger Bill of Rights.
 The Rights of Air Passengers under the said
Administrative Order are as follows:
1. Right to Full, Fair, and Clear Disclosure of the Service Offered and all the
Terms and Conditions of the Contract of Carriage (Section 4);
2. Right to Clear and Non-Misleading Advertisements of, and Important
Reminders Regarding Fares (Section 5);
3. Right Against Misleading and Fraudulent Sales Promotion Practices
(Section 6);
4. Right to Transportation and Baggage Conveyance (Section 7);
5. Right to be Processed for Check-In (Section 8);
6. Right to Sufficient Processing Time (Section 9);
7. Right to Board Aircraft for the Purpose of the Flight (Section 10);
8. Right to Compensation and Amenities in Case of Cancellation of Flight
(Section 11);
9. Right to Compensation and Amenities in Case of Flight Delay (Section 12);
10. Right to Compensation for Delayed, Lost and Damaged Baggage (Section
14);
11. Right to Compensation In Case of Death or Bodily Injury of a Passenger
(Section 15);
12. Right to Immediate Payment of Compensation (Section 16).
RIGHT TO BE INFORMED
The Air Passenger Bill of
Rights places emphasis on
the right of the consumer to
be informed of the complete
terms and conditions of the
contract of carriage, among
others.
RIGHT TO NON-MISLEADING ADVERTISEMENT
In order to prevent travellers
from being misled by apparently
″cheap″ air fares which, in actuality,
cost considerably higher than the
publicized amount, the Air
Passenger Bill if Rights requires air
carrier to disclose all other
mandatory fees and charges,
including government taxes and ful
surcharges, in their fare
advertisement.
RIGHT TO BOARD THE AIRCRAFT
The Air Passenger Bill of Rights takes cognizance
of the practice of air carriers to overbook flights.
 RIGHT TO COMPENSATION AND AMENITIES IN CASE OF
CANCELLATION OF FLIGHT

In case of cancellation of a
passenger’s flight, the air carrier
is obligated to provide sufficient
refreshments, hotel
accommodation, transportation
from airport to the hotel, free
phone calls, texts or emails and
first aid, if necessary.
RIGHT TO COMPENSATION AND AMENITIES IN CASE OF FLIGHT
DELAY

Air carrier are required to

provide refreshments, free
phone calls, text or emails
and first aid as well as re-
book or refund the ticket of
the passenger similar to
when the flight of the
passenger is cancelled.