Transportation Law (Transportation Law and Its Nuances by Claridades)

Question 1

B.3. Distinguish between “operation” and “ownership” of a public utility.

Answer 1

Ownership is defined as a relation in law by virtue of which a thing pertaining to one person is completely subjected to his will in everything not prohibited by law or the concurrence with the rights of another. The exercise of the rights encompassed in ownership is limited by law so that a property cannot be operated and used to serve the public as a public utility unless the operator has a franchise.

Operations, as defined in economics, is any commercial activity, irrespective of form of ownership and irrespective of the nature of the goods, services or rights exchanged or managed for a consideration. Operation of a public utility and its vested rights may exist independently and separately from the ownership of its facilities. One can own said facilities without operating them as a public utility, or conversely, one may operate a public utility without owning the facilities used to serve the public (leasing of aircraft and vessels).

Question 2

C.4. What is the definition of a carrier?

Answer 2

A carrier is a person or corporation who undertakes to transport or convey goods or persons from one place to another, gratuitously or for hire.

A carrier is classified, among other classifications, either as a private or special carrier, or as a common or public carrier.

Question 3

C.7. What is the definition of common or public carriers?

Answer 3

A common carrier may be defined, broadly, as one who holds himself out to the public as engaged in the business of transporting persons or property from place to place, for compensation, offering his services to the public generally.

Article 1732 of the New Civil Code of the Philippines defines a “common carrier” as “any person, corporation, firm, or association 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.”

Question 4

C.8. What are the elements of a common carrier?

Answer 4

(a) A common carrier is a person, corporation, firm, or association.

(b) It is engaged in the business of carrying or transporting passengers, goods, or both.

(c) It does the carriage or transportation by land, water, or air.

(d) It carries or transports passengers and/or goods for compensation.

(e) It offers its services to the public without any distinction whatsoever.

Question 5

C.9. What are the tests for determining a common carrier?

Answer 5

(a) He/It 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 person generally as a business and not as a casual occupation.

(b) He/It must undertake to carry goods of the kind to which his business is confined.

(c) He/It must undertake to carry by the method by which his business is conducted and over his established roads.

(d) The transportation must be for hire.

Question 6

C.17. What type of diligence is required of a common carrier in the carriage of goods and passengers?

Answer 6

Common carriers, “by the nature of their business and for reasons of public policy” (Article 1733, New Civil Code of the Philippines), are held to a very high degree of care and diligence (“extraordinary diligence”) in the carriage of goods as well as of passengers.

Extraordinary diligence is defined as that extreme measure of care and caution which persons of unusual prudence and circumspection use for securing and preserving their own property or rights.

The law requires common carriers to render service with the greatest skill and utmost foresight.

Question 7

C.18. What is the reason for the observance of extraordinary diligence in the carriage of goods?

Answer 7

A common carrier is expected to observe extraordinary diligence in the handling of goods placed in its possession for transport.

The standard of extraordinary diligence imposed upon common carriers is considerably more demanding than the standard of ordinary diligence, i.e., the diligence of pater familias established in respect of the ordinary relations between members of society.

A common carrier is bound to transport its cargo and its passengers safely “as far as human care and foresight can provide, using the utmost diligence of a very cautious person, with due regard to all circumstances”.

The extraordinary diligence in the vigilance over the goods tendered for shipment requires the common carrier to know and to follow the required precaution for avoiding the damage to, or destruction of, the goods entrusted to it for safe carriage and delivery.

It requires common carriers to render service with the greatest skill and foresight and “to use all reasonable means to ascertain to nature characteristic of goods tendered for shipment, and to exercise due care in the handling and stowage, including such methods as their nature requires.”

Question 8

C.19. When does the liability of a common carrier start in its transport of passengers?

Answer 8

The duty of a common carrier commences from the moment the person who purchases the ticket from the carrier presents himself at the proper place and in a proper manner to be transported.

The relation of carrier and passenger continues until the passenger has been landed at the port of destination and has left the vessel owner’s dock or premises.

Once created, the relationship will not ordinarily terminate until the passenger has, after reaching his destination, safely alighted from the carrier’s conveyance or had a reasonable opportunity to leave the carrier’s premises.

Question 9

C.20. When does the liability of a common carrier start in its transport of goods?

Answer 9

The liability of the carrier as common carrier begins with the actual delivery of the goods for transportation, and not merely with the formal execution of a receipt or bill of lading; the issuance of a bill of lading is not necessary to complete delivery and acceptance.

Even where it is provided by statute that liability commences with the issuance of the bill of lading, actual delivery and acceptance are sufficient to bind the carrier.

Question 10

C.21. What are the requisites of extraordinary diligence in carriages by land and by sea?

Answer 10

The requirements of extraordinary diligence in carriage by land include the following:

(1) Good running condition of the vehicle; and
(2) Observance of traffic laws, rules, and regulations.

The requirements of extraordinary diligence in carriage by sea comprise:

(1) Warranty of seaworthiness; and
(2) Warranty against overloading.

Question 10

C.23. What are the liabilities of a common carrier for breach of contract?

Answer 10

The liabilities of a common carrier in case of breach of contract of carriage are classified as:

(1) culpa contractual - negligence based on contract; filed against the common carrier by its passenger.

(2) culpa aquiliana - negligence based on tort; filed against the drivers of both vehicles and their owners; and

(3) culpa criminal - negligence based on a crime; filed against the driver at fault if his act amounts to a crime.

Question 11

C.24. What does an aggrieved party need to prove in breach of contract of carriage?

Answer 11

In an action based on a breach of contract of carriage, the aggrieved party does not have to prove that the common carrier was at fault or was negligent.

All that he has to prove is the existence of the contract and the fact of its nonperformance by the carrier.

Question 12

C.25. What are the defenses in culpa contractual?

Answer 12

The defenses available in culpa contractual are:

(1) exercise of extraordinary diligence;
(2) fortuitous event; and
(3) contributory negligence of passengers.

The defense, however, of contributory negligence does not bar recovery of damages for death or injury if the proximate cause is the negligence of the common carrier, but the amount of damages shall be equitably reduced.

Question 13

C.26. What is the burden of proof in cases of contributory negligence?

Answer 13

The burden of proof in cases of contributory negligence is on the common carrier since with will be the one to benefit from such mitigated liability.

Question 14

C.28. Distinguish between:

1) an action to enforce liability of the employer of the negligent driver under Article 103 of the Revised Penal Code; and

2) an action based on quasi-delict under the New Civil Code of the Philippines.

Answer 14

Revised Penal Code
Article 103
Subsidiary Liability

a) The liability of the employer is only SUBSIDIARY.
b) The civil action against the employer would be PREMATURE if there is no judgment yet convicting the negligent driver.
c) The defense of due diligence in the selection and supervision of employees CANNOT be invoked.

New Civil Code of the Philippines
Article 2180
Direct and Primary Liability

a) The liability of the employer is DIRECT and PRIMARY.
b) The civil action against the employer MAY PROCEED INDEPENDENTLY of the criminal action.
c) The defense of due diligence in the selection and supervision of employees MAY be invoked.

Question 15

C.31. What is the presumption of negligence for common carriers?

Answer 15

Common carriers are presumed to have been at fault or to have acted negligently if the goods transported are lost, destroyed, or deteriorated.

The causes of loss, destruction, or deterioration which exempt the common carrier from responsibility for it is a closed list.

Causes falling outside the foregoing list, even if they appear to constitute a species of force majeure, fall within the scope of Article 1735 of the New Civil Code of the Philippines.

Question 16

C.32. When does the presumption of negligence arise? How is this overcome?

Answer 16

Common carriers are obliged to observe extraordinary diligence in the vigilance over the goods transported by them.

Accordingly, they are presumed to have been at fault or to have acted negligently if the goods are lost, destroyed, or deteriorated.

There are very few instances when the presumption of negligence does not attach and these instances are enumerated in Article 1734 of the New Civil Code of the Philippines.

Article 1734. Common carriers are responsible for the loss, destruction, or deterioration of the goods, unless the same is due to any of the following causes only:

(1) Flood, storm, earthquake, lightning, or other natural disaster or calamity;

(2) Act of the public enemy in war, whether international or civil;

(3) Act or omission of the shipper or owner of the goods;

(4) The character of the goods or defects in the packing or in the containers;

(5) Order or act of competent public authority.

In those cases where the presumption is applied, the common carrier must prove that it exercised extraordinary diligence in order to overcome the presumption.

Question 17

C.33. How can the presumption of fault or negligence of the common carrier be rebutted by the owner of the common carrier?

Answer 17

Article 1756 of the New Civil Code of the Philippines, in creating a presumption of fault or negligence on the part of the common carrier when its passenger is injured, merely relieves the latter, for the time being, from introducing evidence to fasten the negligence on the former, because the presumption stands in the place of evidence.

Being a mere presumption, however, the same is rebuttable by proof that:

(1) the common carrier had exercised extraordinary diligence as required by law in the performance of its contractual obligation; or

(2) the injury suffered by the passenger was solely due to a fortuitous event.

Question 18

C.34. What are the causes exempting the common carrier from responsibility?

Answer 18

Article 1734 of the New Civil Code of the Philippines establishes the general rule that common carriers are responsible for the loss, destruction, or deterioration of the goods which they carry, “unless the same is due to any of the following causes only:”

(1) Flood, storm, earthquake, lightning, or other natural disaster or calamity;

(2) Act of the public enemy in war, whether international or civil;

(3) Act or omission of the shipper or owner of the goods;

(4) The character of the goods or defects in the packing or in the containers;

(5) Order or act of competent public authority.

Question 19

C.35. What are the defense available for common carriers in the carriage of goods to overturn the presumption of fault or negligence in the case of loss, destruction, or deterioration of goods?

Answer 19

The defenses available to a common carrier in the carriage of goods which also serve as the only exceptions to its extraordinary responsibility are the circumstances where the loss, destruction, or deterioration of the goods is attributable to any of the causes provided for under Article 1734 of the New Civil Code of the Philippines which include the following:

(1) Ordinary circumstance, specifically the exercise by the carrier of extraordinary diligence under Article 1735 of the New Civil Code of the Philippines; and

(2) Special circumstances under Article 1734 of the New Civil Code of the Philippines as enumerated above.

Question 20

C.36. What are the defense available for common carriers in the carriage of passengers to overturn the presumption of fault or negligence in the case of passenger’s death or injury?

Answer 20

Conversely, common carriers of passengers may set up the following defenses to overturn the presumption of fault or negligence in the event of death or injury to their passengers:

(1) Exercise of extraordinary diligence under Article 1756 of the New Civil Code of the Philippines; and

(2) Caso fortuito.

Question 21

C.38. What is the definition of caso fortuito?

Answer 21

Caso fortuito or force majeur, by definition, are extraordinary events not foreseeable or avoidable, event that could not be foreseen, or which though foreseen, were inevitable.

It is, therefore, not enough that the event should not have been foreseen or anticipated, as is commonly believed, but it must be one that is impossible to foresee or to avoid.

Question 22

C.40. Are accidents due to mechanical defects categorized as under fortuitous events? Give examples.

Answer 22

No.

The mechanical defects in the carrier are not considered as caso fortuito that would exempt the carrier from responsibility.

A tire blowout of a jeep, for instance, is not a fortuitous event if there exists a specific act of negligence by the carrier consisting of the fact that the jeepney was overloaded and speeding at the time of the incident.

Likewise, a mishap caused by defective brakes could not be considered fortuitous in character.

Question 23

C.41. Is fire considered a natural disaster or calamity?

Answer 23

No.

Fire may not be considered a natural disaster or calamity. This must be so as it arises almost invariably from some act of man or by human means.

It does not fall within the category of an act of God unless caused by lightning, or by other natural disaster or calamity. It may even be caused by the actual fault or privity of the carrier.

Where, however, the cargoes were discharged, complete and in good order, unto the warehouse of the Bureau of Customs but said warehouse was razed by a fire of unknown origin, destroying the cargoes and there was not a shred of proof that the cause of the fire was in any way attributable to the negligence of the carrier, the latter is not liable.

Question 24

C.42. Are storms or typhoons considered as fortuitous events? What situations are these applicable and what are the exceptions, if any?

Answer 24

A typhoon or storm is a fortuitous event, a natural occurrence, which may be foreseen but is unavoidable despite any amount of foresight, diligence, or care.

In order to be exempt from liability arising from any adverse consequence engendered thereby, there should have been no human participation amounting to a negligent act. In other words, the person seeking exoneration from liability must not be guilty of negligence.

Negligence, as commonly understood, is conduct which naturally or reasonably creates undue risk or harm to others.

It may be the failure to observe that degree of care, precaution, and vigilance which the circumstances justify demand or the omission to do something which a prudent and reasonable man, guided by considerations which ordinarily regulate the conduct of human affairs, would do.

In a case, the failure of the carrier to ascertain the direction of the storm and the weather condition of the path it would be traversing was held to be constitutive of lack of foresight and minimum vigilance over its cargoes, taking into account the surrounding circumstances of the case. Hence, the carrier was liable.

Question 25

C.43. What stipulations in a contract of carriage are deemed unreasonable, unjust, and contrary to public policy.

Answer 25

Article 1745 of the New Civil Code of the Philippines outlines the stipulations in a contract of carriage that are deemed unreasonable, unjust, and contrary to public policy:

(1) That the goods are transported at the risk of the owner or shipper;

(2) That the common carrier will not be liable for any loss, destruction, or deterioration of the goods;

(3) That the common carrier need not observe any diligence in the custody of the goods;

(4) That the common carrier shall exercise a degree of diligence less than that of a good father of a family, or of a man of ordinary prudence in the vigilance over the movables transported;

(5) That the common carrier shall not be responsible for the acts or omission of his or its employees;

(6) That the common carrier’s liability for acts committed by thieves, or of robbers who do not act with grave or irresistible threat, violence or force, is dispensed with or diminished;

(7) That the common carrier is not responsible for the loss, destruction, or deterioration of goods on account of the defective condition of the car, vehicle, ship, airplane or other equipment used in the contract of carriage.