CONTRACT OF TRANSPORTATION – It is a contract whereby a certain person or association of persons obligate themselves to transport persons, things, news, from one place to another for a fixed price
Art. 1766. In all matters not regulated by this Code, the rights and obligations of common carriers shall be governed by the Code of Commerce and by special laws.
Governing Laws:
1. New Civil Code 2. Code of Commerce 3. Special Laws
Parties to the Contract of Transportation:
1. Shipper - one who gives rise to the contract of transportation by agreeing to deliver the things or news to be transported, or to present his own person or those of other or others in the case of transportation of passengers
2. Carrier/Conductor - one who binds himself to transport persons, things, or news, as the case may be, or one employed in or engaged in the business of carrying goods for others for hire
GENERAL PROVISIONS ON COMMON CARRIERS:
Difference between common and private carrier:
COMMON CARRIER PRIVATE CARRIER person, corporation, firm,
association engaged in the business of carrying
or transporting passengers, goods or
both, by land, water, air, for compensation, offering services to the public;
is not engaged in the business of carrying for the public
must exercise extraordinary diligence
requires only ordinary diligence.
he holds himself out as engaged in public service
carries only for persons with whom he has initial
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to all persons indifferently. contract and assumes no obligation to carry for the others
To be a common carrier, must the carrier’s principal activity be the carriage of persons or goods?
No. Art. 1732 of the 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 (sideline).
Requisites to be a Common Carrier
1. Engaged in business of carrying or transporting goods or passengers whether as principal or ancillary business and whether on regular/scheduled or occasional basis.
2. Offers its services to the public whether to the general population or narrow segment of general population
3. For compensation or fixed price or rate 4. Control of operation or cargo
General Rule: The common carrier is presumed to have been at fault or to have acted negligently when the goods transported are lost, destroyed or deteriorated, or when a passenger dies or is injured.
Exception: When the same is due to any of the following causes only:
1. Flood, storm, earthquake, lightning or other natural disaster or calamity.
Conditions to avail of defense:
a. natural disaster was the proximate & only cause
b. exercise of diligence to prevent or minimize loss
c. no delay (Art. 1740 New Civil Code [NCC])
2. Act of the public enemy in war, whether international or civil.
Conditions to avail of defense:
a. act was the proximate & only cause b. exercise of diligence to prevent or
minimize loss
c. no delay (Art. 1740, NCC)
3. Act or omission of the shipper or owner of the goods.
Note: There should be a protest when the defect due to the act or omission is visible.
Conditions to avail of defense:
a. if proximate cause, exempting b. if contributory negligence, mitigating 4. The character of the goods or defects in the
packing or in the containers.
Note: There should be a protest when the defect due to the act or omission is visible.
Conditions to avail of defense: exercise of due diligence to forestall or prevent loss 5. Order or act of competent authority.
Conditions to avail of defense: with power to issue order
Exception to the Exception:
1. When the natural disaster is not the proximate and only cause of the loss;
2. When the common carrier failed to exercise due diligence to prevent or minimize the loss before, during and after the occurrence of the natural disaster; and
3. When the common carrier negligently incurs in delay in transporting the goods.
NOTES REGARDING THE COMMENCEMENT AND TERMINATION OF EXTRAORDINARY
RESPONSIBILITY OF THE COMMON CARRIER 1. The extraordinary responsibility of the
common carrier in the transportation of goods 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.
2. Also even when the goods are temporarily unloaded or stored in transit, unless shipper used right of stoppage in transitu.
3. During the time of the storage at warehouse of common carrier at place of destination, until consignee is advised of good’s arrival and has had opportunity to remove or dispose of them.
4. As to the transportation of persons, there are two views:
a. Liberal view- when a person offers to be transported placing himself in the care and control of the common carrier who accepts him as such passenger.
(Philippine law adopts this view)
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b. Strict view- there is actual boarding or placing of a part of the passenger’s body in the vehicle. The contract terminates when the passenger alights from the vehicle at the place of destination and has reasonable opportunity to leave the common carrier. [Airline has no control over pre-departure area]
EXTRAORDINARY DILIGENCE OR RESPONSIBILITY OF COMMON CARRIER REGARDING TRANSPORT OF GOODS – (1) To transport with greatest skill and utmost foresight (2) Utmost vigilance of very cautious person, according to all circumstances
Is delivery of the common carrier to the customs authorities considered as delivery to the consignee so as to end the carrier’s extraordinarily responsibility over the goods?
Delivery of the cargo to the customs authorities is not delivery to the consignee or “to the person who has a right to receive them” because in such case the goods are still in the hands of the government and the owner cannot exercise dominion over them.
However, the parties may agree to limit the liability of the carrier.
General Rule: The extraordinary diligence of the common carrier over the goods continues even when the goods are temporarily unloaded or stored in transit.
Exception: when the shipper or owner has made use of the right of stoppage in transitu.
REQUISITES FOR A VALID STIPULATION IN TRANSPORTATION OF GOODS CONTRACT BETWEEN THE COMMON CARRIER AND THE SHIPPER OR OWNER LIMITING THE LIABILITY OF THE FORMER TO LESS THAN THE EXTRAORDINARY DILIGENCE
1. In writing
2. Supported by a valuable consideration other than the service rendered by the common carrier
3. Reasonable, just and not contrary to public policy.
A STIPULATION IN TRANSPORTATION OF GOODS CONTRACT LIMITING LIABILITY IS VOID IF:
1. unreasonable 2. unjust
3. contrary to public policy
A STIPULATION IN TRANSPORTATION OF GOODS CONTRACT LIMITING LIABILITY IS VALID
1. limited to value of goods appearing in the bill of lading
2. fixed sum that is reasonable and just and agreed upon
3. delay due to strike or riot
What provisions of law shall apply to a passenger’s baggage?
The provisions of Articles 1733 to 1753 shall apply to the passenger’s baggage which is not in his personal custody or in that of his employees. As to the other baggage, the rules in Articles 1998 and 2000 to 2003 concerning the responsibility of hotel-keepers shall apply.
REQUISITES FOR A CASO FORTUITO WHICH WOULD EXEMPT THE CARRIER FROM LIABILITY
1. The event must be independent of human will
2. The occurrence must render it impossible for the debtor to fulfill the obligation in a normal manner
3. The obligor must be free of participation in, or aggravation of, the injury to the creditor, and 4. The event must have been impossible to
foresee, or if it could be foreseen, must have been impossible to avoid.
Passenger –one who travels in a public conveyance by virtue of an express or implied contract with the common carrier paying fare or what is equivalent thereof.
NOTE: The contributory negligence of the passenger does not bar recovery of damages for his death or injuries, if the proximate cause thereof is the negligence of the common carrier, but the amount of damages shall be equitably reduced.
DEFENSES THAT A COMMON CARRIER INVOKE TO BE EXEMPTED FROM LIABILITY OR MITIGATE SUCH LIABILITY
1. Exercise of extraordinary diligence by a common carrier
2. Negligent act of the passenger the proximate cause of death and injury.
3. Employees could not have prevented by ordinary diligence the willful act or negligence of other passengers or strangers which caused the injury or death.
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4. Liability is mitigated by the contributory negligence of passenger or his failure to observe ordinary diligence to avoid injury.
5. Stipulation to limit liability is valid in gratuitous carriage if no willful act or gross negligence by common carrier.
NOTE: Common carriers are liable for the death or injuries to passengers through the negligence or willful acts of the former’s employees, although such employees may have acted beyond the scope of their authority or in violation of the orders of the common carriers.
A passenger brought into the bus a box which he declared to contain clothes and other harmless items. It turned out that the box contained firecrackers. A passenger was injured when the firecrackers exploded. Is the carrier liable?
The carrier is not liable as it exercised extraordinary diligence. It is to be presumed that the passenger will not take with him anything dangerous to the life and limbs of his co-passengers, not to speak of his own. Not to be considered lightly is the right to privacy to which each passenger is entitled.
Will the answer to the above be the same if the carrier is an airplane?
No. While there is no law that authorizes bus operators to open the luggage of their passengers, RA 6235 (Acts Inimical to Civil Aviation) gives the airline companies operating as public utilities the authority to open and investigate packages and cargoes being loaded on board the aircraft. Should the personnel of the airline fail to discover the explosive devise, it could only be due to their failure to exercise the utmost diligence of very cautious persons for which the air carrier may be held liable.
May the responsibility of the common carrier for the safety of the passengers be dispensed with or lessened?
No. The responsibility of a common carrier for the safety of passengers a required by law cannot be dispensed with or lessened by stipulation, by posting of notices, by statements on tickets or otherwise.
Exception: In gratuitous carriage, stipulation to limit liability may be valid but not for willful act or gross negligence.
MORAL DAMAGES MAY BE RECOVERED IN AN ACTION FOR BREACH OF CONTRACT OF TRANSPORTATION
1. When death results.
2. Even if death does not result, when the carrier was guilty of fraud or bad faith.
However only the injured passenger is entitled to moral damages due to his injury.
NOTE: The defense of the exercise of all the diligence of a good father in the selection and supervision of their employees is appropriate only in the quasi-delict or culpa aquiliana. It is not available, however, in culpa contractual and therefore, a common carrier cannot raise such defense in action brought by its passengers.
BILL OF LADING – written acknowledgment of receipt of goods and agreement to transport them to a specific place to a person named or his order.
NOTE: It is not indispensable to the creation of a contract of carriage. The contract itself arises from the moment goods are delivered by shipper to carrier and the carrier agrees to carry them.
The bill of lading serves 3 functions:
1. It is a receipt for the goods shipped
2. It is a contract by which the three parties namely the shipper, carrier and consignee undertake specific responsibilities and assume stipulated obligations; and
3. It is a legal evidence of the contract between the shipper and the carrier. As evidence, its contents shall decide all disputes which may arise with regard to their execution and fulfillment.
NOTE: In the absence of a bill of lading, their respective claims may be determined by legal proofs which each of the contracting parties may present in conformity with law.
How may the contract of transportation be proven in the absence of a bill of lading?
In the absence of a bill of lading, their respective claims shall be determined by legal proofs which each of the contracting parties may present in conformity with the general provisions established in this Code for commercial contracts.
Delivery
The carrier must deliver the goods in the same condition and quantity in which they were received according to the bill of lading.
Partial/Defective Delivery
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1. In case of partial delivery, consignee may refuse to receive those delivered if they cannot be used independently of those not delivered.
2. If the goods delivered were rendered useless for sale or consumption, consignee may refuse to receive.
3. If the goods delivered are damaged to such an extent that their value is diminished, carrier must pay the difference in value as judged by experts.
In the first 2 cases, consignee may exercise abandonment and be entitled to the full value of the goods.
NOTES REGARDING CLAIMS ON ACCOUNT OF DAMAGE TO THE GOODS TRANSPORTED:
1. If the damage is apparent from the exterior of the package, the claim must be made upon receipt of the package.
2. If the damage cannot be known from the exterior, the claim must be made within 24 hours following the receipt of the
merchandise. [longer period may be stipulated]
3. After the periods have elapsed, or after the transportation charges have been paid, no claim whatsoever shall be admitted against the carrier with regard to the condition in which the goods transported were delivered.
4. Claim is a condition precent to right of action, which must be filed within 1 year from delivery of goods or denial of claim.
[Sufficient shorter period maybe stipulated in bill of lading]