VIGILANCE OVER GOODS Flashcards
What are the requisites for natural disaster to be considered an exempting circumstance in case of loss or damage to goods?
- The natural disaster is the proximate and only cause of the loss;
- The common carrier should have exercised due diligence to prevent or minimize the loss before, during and after the occurrence of the natural disaster;
- The common carrier should not incur in delay.
Philip Mauricio shipped a box of cigarettes to a dealer in Naga City through Bicol Bus Company (BBC). When the bus reached Lucena City, the bus developed engine trouble. The driver brought the bus to a repair shop in Lucena where he was informed by the mechanic that an extensive repair was necessary, which would take at least two (2) days. While the bus was in the repair shop, Typhoon Coring lashed Quezon
Province. The cargoes inside the bus, including Mauricio’s cigarettes, got wet and were totally spoiled. Mauricio sued BBC for damage to his cargoes. Decide.
The BBC is liable for damages to the cargoes lost by Mauricio.
Typhoon, as a natural disaster, would relieve the common carrier from liability if it is the proximate and only cause of the damage.
The fact that the bus developed engine trouble and extensive repair work was necessary affirm that the force majeure was not the proximate and only cause of the damage.64
A shipment of electronic goods arrived at the Port of Manila for Sony Philippines, Inc. (Sony). Previous to the arrival, Sony had engaged the services of TMBI to facilitate, process, withdraw, and deliverthe shipmentfrom the port to its warehouse in Bihan. TMBI - who did not own any delivery trucks - subcontracted the services of BMT Trucking Services (BMT), to transport the shipment from the port to the Bihan warehouse. Four (4) BMT trucks picked up the shipment from the port. However, only three (3) trucks arrived at Sony’s Bihan warehouse. The fourth truck driven by Rufo Reynaldo Lapesura was found abandoned.
Mitsui, the insurer, paid the claims and ran after TMBI. TMBI, however, denied being a common carrier because it does not own a single truck to transport its shipment and it does not offer transport services to the public for compensationand hence, it is not bound to observe extraordinary diligence. Furthermore, TMBI insists that the hijacking of the truck was a
fortuitous event which should exonerate its liability.
a. Is TMBI is a common carrier?
Yes, TMBI is a common carrier. The delivery of the goods is an integral, albeit ancillary, part of its brokerage services. TMBI admitted that it was contracted to facilitate, process, and clear the shipments from the customs authorities, withdraw them from the pier, then transport and deliver them to Sony’s warehouse in Laguna. That TMBI does not own trucks and has to subcontract the delivery of its clients’ goods, is immaterial. As long as an entity holds itself to the public for the transport of goods as a business, it is considered a common carrier regardless of whether it owns the vehicle used or has to actually hire one. Lastly, TMBI’s customs brokerage services - including the transport/delivery of the cargo - are available to anyone willing to pay its fees.
Should TMBI be held liable for the hijacking of the truck?
TMBI is liable for the hijacking ofthe truck. Theft or the robbery of the goods is not considered a fortuitous event or a force majeure. Nevertheless, a common carrier may absolve itself of liability for a resulting loss: (1) if it proves that it exercised extraordinary diligence in transporting and safekeeping the goods; or (2) if it stipulated with the shipper/owner of the goods to Emit its liability
for the loss, destruction, or deterioration of the goods to a degree less than extraordinary diligence.
Instead of showing that it had acted with extraordinary diligence, TMBI simply argued that it was not a common carrier bound to observe extraordinary diligence. Its failure to successfully establish this premise carries with it the presumption of fault or
negligence, thus rendering it liable to Sony/Mitsui for breach of contract.
Because of spillage of the rice during the trip from Davao to Manila due to the bad condition of the sacks, there was a shortage in the rice delivered by the Provident Lines Inc. to the consignee XYZ Import and Export Corporation. The carrier accepted the shipment, knowing that the sacks had holes and some had broken strings. When sued, Provident Lines, Inc. alleged that the loss was caused by the spillage of the rice on account of the defective condition of the sacks, at the time it received the shipment, and therefore, it cannot be held liable. Decide. Give reasons.
The maritime carrier is liable. Where the fact of improper packing is known to the carrier or its servants, or apparent upon ordinary observations, but the carrier accepts the goods notwithstanding such conditions, it is not relieved of liability for loss or injury resulting therefrom.
The rule is that if the improper packing or, in this case, the defect/s in the container, is/are known to the carrier or his employees or apparent upon ordinary observation, but he nevertheless accepts the same without protest or exception notwithstanding such condition, he is not relieved of liability for damage resulting
therefrom. In this case Provident Lines, Inc. accepted the cargo without exception despite the apparent defects in some of the container vans. Hence, for a failure of Provident Lines, Inc. to prove that it exercised extraordinary diligence in the carriage of goods in this case or that it is exempt from liability, the presumption of negligence as provided under Article 1735 holds.
Y contracted the services of X to haul tons of scrap iron from Bataan to the port of Manila on board the lighter “Batman.” Z sent his lighter to dock at Mariveles, where Y delivered the scrap irons for loading which also began on the same day. The Acting Mayor, together with three (3) policemen, ordered the dumping of the scrap iron where the lighter was docked and the restto be broughtto NASSCO compound. Isthe intervention of the municipal officials considered a force majeure as to exempt the carrier from any liability?
No. The intervention of municipal officials was not in any case, of a character that would render impossible the fulfillment by the carrier of its obligation. The carrier was not duty bound to obey the illegal order to dump into the sea the scrap iron. Moreover, there is absence of sufficient proof that the issuance of the same order was attended with such force and intimidation as to completely overpower the will of the carrier’s employees. The mere difficulty in the fulfillment of the obligation is not considered force majeure.
A, in Manila, shipped on board a vessel of B, chairs to be used in the restaurant of consignee C in Cebu. No date for delivery or indemnity for delay was stipulated. The chairs, however, were not claimed promptly by C and were shipped by mistake back to Manila, where it was discovered and re-shipped to Cebu. By the time the chairs arrived, the date of inauguration of the movie house passed by and it had to be postponed. C brings action for damages against B, claiming loss of profits during the Christmas season when he expected the movie house to be opened. Decide the case with reasons.
C, may bring action for damages against B for loss of profits. The obligation of the carrier to carry cargo includes the duty not to delay their transportation, so that if the carrier is guilty of delay in the shipment of the cargo, causing damages to consignee, it will be liable.71
However, in Maersk Line u. Court of Appeals?
the Supreme Court held that the oft-repeated rule regarding a carrier’s liability for delay is that in the absence of a special contract, a carrier is not an insurer against delay in transportation of goods. When a common carrier undertakes to convey goods, the law implies a contract that they shall be delivered at destination within a reasonable time, in the absence, of any agreement as to the time of delivery.
The ruling in Maersk is the more accepted view. A similar ruling was adopted in another case.
What is the effect of contributory negligence on the part of the shipper in case of loss or damage to his goods?
If the shipper or owner merely contributed to the loss, destruction, or deterioration of the goods, the proximate cause thereof being the negligence of the common carrier, the latter shall be liable in damages, which however, shall be equitably reduced.
On the other hand, even if the loss, destruction, or deterioration of the goods should be caused by the character of the goods, or thd faulty nature of the packing or of the containers, the common carrier must exercise due diligence to forestall or lessen the loss
In a contract of carriage for goods, when does the obligation to exercise extraordinary diligence commence and when does it end?
The extraordinary responsibility of the common carrier lasts from the time the goods are unconditionally placed in the possession of, and received by the carrier for transportation until the same are delivered, actually or constructively, by the carrier to the consignee, or to the person who has a right to receive them.76
The carrier’s liability as a common carrier begins with the actual delivery of the goods for transportation and not with the mere formal execution of a receipt or bill of lading because the issuance ofsuch 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.77
The fact that part of the shipment had not been loaded on board the Eghter does not impair the contract of transportation as the goods remained in the custody and control of the carrier, albeit still unloaded.
Does the obligation of a common carrier to exercise extraordinary diligence cease when the goods are turned over to the customs authorities?
The delivery to the customs authorities is not the dehvery contemplated by Article 1736 because the owner cannot exercise dominion over them, it believes that the parties may agree to Hmit the HabiHty of the carrier in connection therewith considering that the goods have still to go through the inspection of the custom; authorities. The carrier losses control of the goods because of a
custom regulation and it is unfair that it be made responsible for what may happen during the interregnum.
In the corresponding bill of lading, both the carrier and the consignee have stipulated to Hmit the responsibility of the former for the loss or damage that may occur to the goods before they are actually delivered. It appears that the carrier does not assume HabiHty for any loss or damage once they have been taken into the
custody of customs or other authorities or when they have been delivered at ship’s tackle. These stipulations have been adopted precisely to mitigate the responsibility of the carrier considering the present law on the matter and the Court found nothing therein that is contrary to morals or public policy that may justify their nullification.
X took the Benguet Bus from Baguio going to Manila. He deposited his maleta in the baggage compartment of the bus common to all passengers. He did not declare his baggage nor pay its charges contrary to the regulations of the bus company. When X got off, he could not find his maleta which obviously was taken by another passenger. Determine the liability of the bus company.
The bus company is liable for the loss of the maleta. The duty ofextraordinary diligence in the vigilance over the goods is due on such goods as are deposited or surrendered to the common carrier for transportation. The fact that the maleta was not declared nor the charges paid thereon would not be consequential so long as it was received by the carrier for transportation
X delivered 10 boxes of goods in good order to the carrier. Y, the consignee, however, received the same in bad condition. No proof of negligence was offered by X or Y. Is the common
carrier liable for damages?
Yes, mere proof delivery of the goods in good order to a common carrier and oftheir arrival in bad order at their destination constitutes h prima facie case of fault or negligence against the carrier. If no adequate explanation is given as to how the deterioration, loss, or destruction of the goods happened, the transporter shall be held responsible
What is the effect of a stipulation regarding the exercise of diligence to less than extraordinary?
In the carriage of goods, the carrier and shipper may agree on the observance of diligence to a degree less than extraordinary (but not total exemption nor diligence less than ordinary) provided the stipulation is: (1) in writing; (2) supported by a valuable consideration other than the service rendered by the carrier; and (3) reasonable, just, and not contrary to public policy.
Cite stipulations in a contract of carriage which are considered unreasonable, unjust, and contrary to public policy.
Article 1745
Any of the following or similar stipulations shall be considered unreasonable, unjust, and contrary to public policy:
- That the goods are transported at the risk of the owner or shipper;
- That the common carrier will not be liable for any loss, destruction, or deterioration of the goods;
- That the common carrier need not observe any diligence in the custody of the goods;
- 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;
- That the common carrier shall not be responsible for the acts or omission of his or its employees;
- 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;
- 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.
A condition was printed at the back of the tickets which provides that any and all actions arising out of the ticket, irrespective of where it is issued, shall be filed before the courts of Cebu City.
Is this stipulation valid and enforceable? Were the passengers deemed to have acceded to it when they purchased the tickets and took the carrier’s vessel for passage and thus amounted to effective waiver of venue?
The condition is void and unenforceable for two (2) reasons:
First, it is not just and fail- to bind passengers to the conditions printed in fine letter at the back of the tickets. It is hardly proper to expect the passengers to examine then- tickets after they received them from crowded counters. No reasonable opportunity is given to them in order to carefully examine the said condition prior to the purchase of the tickets. Moreover, it must be noted that shipping companies are franchise holders of certificates of public convenience and therefore possess a virtual monopoly of the business of transporting passengers. As such, they may dictate the terms of passage, leaving the passengers with no choice but to buy tickets and avail of their vessels and facilities.
Second, it subverts the public policy on transfer of venue of proceedings since the same will prejudice the rights and interests of innumerable passengers. Although venue may be changed by agreement, such an agreement will not be held valid where it practically negates the action of the claimants. Considering the expense and trouble a passenger residing outside of Ce’bu City would incur to prosecute a claim in the said city, he would most probably decide not to file the action at all.
