01 MALAYAN INSURANCE CO., INC. vs. PHILIPPINES FIRST INSURANCE CO. INC.

and DOCTRINE: School services are considered as common carriers. There is no question that the Pereñas
REPUTABLE FORWARDER SERVICES, INC. as the operators of a school bus service were: (a) engaged in transporting passengers generally as
a business, not just as a casual occupation; (b) undertaking to carry passengers over established
ER: Wyeth and Reputable have a contract of carriage. In their contract, Reputable will be liable for any roads by the method by which the business was conducted; and (c) transporting students for a
loss or damage to Wyeth’s goods during delivery. The contract required Reputable to obtain an insurance fee. Despite catering to a limited clientèle, the Pereñas operated as a common carrier because they
for said goods, different from the insurance obtained by Wyeth from Philippine First. Reputable got an held themselves out as a ready transportation indiscriminately to the students of a particular
insurance from Malayan. The truck of Reputable carrying Wyeth’s products got hijacked. Phil. First paid school living within or near where they operated the service and for a fee. The Pereñas, acting as a
Wyeth, and due to subrogation, demanded reimbursement from Reputable and Malayan. Malayan contend common carrier, were already presumed to be negligent at the time of the accident because death
that it is not liable because of double insurance, and that Reputable is a common carrier, thus not liable for had occurred to their passenger. The presumption of negligence, being a presumption of law, laid
loss due to theft. SC: Reputable is a private carrier. Hence, liability is based on the contract. Since the burden of evidence on their shoulders to establish that they had not been negligent.
the contract said that Reputable is liable for loss due to any and all causes whatsoever. Reputable
being held liable, Malayan shall pay the coverage of the policy. #4 SCHMITZ TRANSPORT & BROKERAGE CORPORATION, petitioner, vs. TRANSPORT VENTURE,
INC. (TVI), INDUSTRIAL INSURANCE COMPANY, LTD., and BLACK SEA SHIPPING AND DODWELL
DOCTRINE: The finding of the RTC and CA that Reputable is a special or private carrier is now INCHCAPE SHIPPING SERVICES, respondents.
warranted by the evidence on record, primarily, the unrebutted testimony of Reputable’s VP and
GM who expressly stated in open court that Reputable serves only one customer, Wyeth. Under E.R. 545 hot rolled steel sheets in coil were shipped on board a vessel owned by Black Sea Shipping from
Article 1732 of the Civil Code, common carriers are persons, corporations, firms, or associations Russia to Manila. Upon arrival to Manila, Petitioner was responsible for the delivery of the goods to the
engaged in the business of carrying or transporting passenger or goods, or both by land, water or consignee’s warehouse. 37 of the 545 coils were unloaded from the vessel unto a barge owned by TVI,
air for compensation, offering their services to the public. On the other hand, a private carrier is one which services was engaged by Petitioner. No tugboat pulled the barge back to the pier. Due to strong
wherein the carriage is generally undertaken by special agreement and it does not hold itself out to waves, the crew of the barge abandoned it and the barge eventually capsized washing the 37 coils to the
carry goods for the general public. The extent of a private carrier’s obligation is dictated by the sea. The lost cargoes were not recovered. The consignee of the goods filed a formal claim against its
stipulations of a contract it entered into, provided its stipulations, clauses, terms and conditions are not insurer and the latter filed a complaint against petitioner, and respondents. Petitioner and TVI were held
contrary to law, morals, good customs, public order, or public policy. solidarily liable as the loss was not due to acts of God but was because of the negligence of both parties.

#2 National Steel Corporation vs CA and Vlasons Shipping, Inc. DOCTRINE: Schmitz is a common carrier. For it undertook to transport the cargoes from the shipside of
"M/V Alexander Saveliev" to the consignee's warehouse at Cainta, Rizal. As long as a person or
E.R.: Petitioner NSC and respondent VSI entered into a contract of voyage charter for hire wherein VSI corporation holds [itself] to the public for the purpose of transporting goods as [a] business, [it] is already
would ship NSC’s tinplates and hot rolled sheets from Iligan -> Manila. When it arrived, it was found out to considered a common carrier regardless if [it] owns the vehicle to be used or has to hire one. Petitioner,
be damaged due to sea water. This prompted NSC to file for damages against VSI, arguing that the latter which did not have any barge or tugboat, engaged the services of TVI as handler to provide the barge and
was negligent. But VSI claimed that it was not a common carrier. SC agreed with VSI because it was a the tugboat. In the case of TVI, while it acted as a private carrier for which it was under no duty to observe
private carrier, thus, NCC provisions do not apply, and instead, the provisions of their contract apply. In extraordinary diligence, it was still required to observe ordinary diligence to ensure the proper and careful
their contract, it was stipulated that VSI would not be liable unless it was proven that its vessel officers handling, care and discharge of the carried goods. TVI's failure to promptly provide a tugboat did not only
were willfully negligent, and the vessel was not seaworthy. The burden of proof lies with NSC in which the increase the risk that might have been reasonably anticipated during the shipside operation, but was the
latter failed to discharge. proximate cause of the loss.

DOCTRINE: Its vessel is engaged in tramping services and is only available for hire under special #5 Asia Lighterage and Shipping, Inc. v. Court of Appeals
contracts of charter party and that the presumption provided in the NCC that common carriers are
negligent in case of loss/damage to cargo is inapplicable. In an action against a private carrier for loss of, ER: Tons of Wheat were delivered to Manila for Gen. Milling Corp. (GMC) This shipment was insured by
or injury to, cargo, the burden is on the plaintiff to prove that the carrier was negligent or unseaworthy, and Prudential Insurance. Asia Lighterage and Shipping, Inc. (ALSI) was the one contracted by GMC to deliver
the fact that the goods were lost or damaged while in the carrier’s custody does not put the burden of proof the same from Port to the latter’s warehouse at Pasig City. The delivery by ALSI did not reach the
on the carrier. The true test of a common carrier is the carriage of passengers or goods, provided it has destination as the barge developed a hole after hitting a sunken object. The hole was then patched with
space, for all who opt to avail themselves of its transportation service for a fee. A carrier which does not clay and cement. Despite this and its knowledge of an approaching typhoon, ALSI proceeded with the
qualify under the above test is deemed a private carrier. delivery but not too soon its barge sank completely due to its broken bits. Prudential paid GMC its claim,
and the former sought reimbursement from ALSI. ALSI contends it is not a common carrier and that the
03 Sps. Teodoro Perena vs. and Sps. Teresita Zarate, et. al. sinking happened due to a fortuitous event, which fact should exempt him from liability. SC held that ALSI
E.R.: The Zarates contracted the Pereñas to transport Aaron to and from Don Bosco. An accident is a common carrier as it falls under Art. 1732 and that it has failed to show that it exercised extraordinary
occurred and their son died. They sued Pereñas. Their defense is that they observed the diligence of a diligence in the vigilance over the goods transported by them when the ship has already sustained
good father of a family. The Court held that this is not enough because the school service, as a common damages but it still proceeded with the delivery despite the existence of storm.
carrier, is bound "to observe extraordinary diligence in the vigilance over the goods and for the safety of
the passengers transported by them, according to all the circumstances of each case. DOCTRINE: The law 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. There is also no
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. Further, there is no pipelines are not included in the term “common carrier” which refers solely to ordinary carriers or motor
difference between a carrier offering its services to the general public, and one who offers services or vehicles. The trial court dismissed the complaint, and such was affirmed by the Court of Appeals.
solicits business only from a narrow segment of the general population. In the case at bar, the principal
business of the petitioner is that of lighterage and drayage and it offers its barges to the public, despite its DOCTRINE: Article 1732 of the Civil Code defines a "common carrier" as "any person, corporation, firm or
limited clientele for carrying or transporting goods by water for compensation. Petitioner is clearly a association engaged in the business of carrying or transporting passengers or goods or both, by land,
common carrier. water, or air, for compensation, offering their services to the public.” There is no doubt that petitioner is a
common carrier. It is engaged in the business of transporting or carrying goods, i.e. petroleum products,
To overcome the presumption of negligence, the common carrier must prove that it exercised for hire as a public employment. It undertakes to carry for all persons indifferently, that is, to all persons
extraordinary diligence. EXCEPTIONS: who choose to employ its services, and transports the goods by land and for compensation. The fact that
(1) Flood, storm, earthquake, lightning, or other natural disaster or calamity; petitioner has a limited clientele does not exclude it from the definition of a common carrier. 
(2) Act of the public enemy in war, whether international or civil;
(3) Act or omission of the shipper or owner of the goods; #9 LIGHT RAIL TRANSIT AUTHORITY & RODOLFO ROMAN vs. MARJORIE NAVIDAD, Heirs of the Late
(4) The character of the goods or defects in the packing or in the containers; NICANOR NAVIDAD & PRUDENT SECURITY AGENCY
(5) Order or act of competent public authority.
E.R.: Nicanor Natividadg the fare, stood on the platform near the LRT tracks, where a security guard
#6 Torres-Madrid Brokerage, Inc. vs. FEB Mitsui Marine Insurance surnamed Escartin approached him. An altercation between the two ensued. Nicanor fell as the LRT train
being operated by Roman was coming in. Nicanor died, so his heirs sought damages from Escartin
E.R. Sony engaged the services of TMBI to transport its shipment to a warehouse in Laguna. TMBI (security guard), Roman (train operator), LRTA (train owner), Metro Transit (Roman’s employer) and
subcontracted BMT since it did not have its own trucks. One of the trucks was hijacked SC held that TMBI Prudent (Escartin’s employer). RTC ruled in favor of the heir, holding Prudence and Escartin liable. CA
is a common carrier. That TMBI does not own trucks and has to subcontract the delivery of its clients’ exonerated Prudence and Escartin; found LRTA and Roman liable. SC: absolved Roman; found LRTA
goods, is immaterial. As long as an entity holds itself to the public for the transport of goods as a business, solely liable. LRTA is presumed to be at fault. In case of death or injury, a carrier is presumed to have
it is considered a common carrier regardless of whether it owns the vehicle used or has to actually hire been at fault or been negligent, and by simple proof of injury, the passenger is relieved of the duty to still
one. establish the fault or negligence of the carrier or of its employees and the burden shifts upon the carrier to
prove that the injury is due to an unforeseen event or to force majeure. In the absence of satisfactory
DOCTRINE: A brokerage may be considered as a common carrier if it also undertakes to deliver the explanation by the carrier on how the accident occurred, which petitioners, according to the appellate
goods to its customers. TMBI’s customs brokerage services – including the transport/delivery of the cargo court, have failed to show, the presumption would be that it has been at fault.
– are available to anyone willing to pay its fees. Given these circumstances, we find it undeniable that DOCTRINE: In case of death or injury, a carrier is presumed to have been at fault or been negligent and
TMBI is a common carrier. by simple proof of injury, the passenger is relieved of the duty to still establish the fault or negligence of
the carrier or of its employees and the burden shifts upon the carrier to prove that the injury is due to an
unforeseen event or to force majeure. The foundation of LRTAs liability is the contract of carriage and its
#7 SPOUSES DANTE & LEONORA CRUZ v. SUN HOLIDAYS, INC. obligation to indemnify the victim arises from the breach of that contract by reason of its failure to exercise
the high diligence required of the common carrier. In the discharge of its commitment to ensure the safety
E.R. Ruelito and his wife spent their honeymoon at the Coco Beach Island Resort. The package that they of passengers, a carrier may choose to hire its own employees or avail itself of the services of an outsider
availed of includes the transportation to and from the resort. A certain Matute claimed that on the day of or an independent firm to undertake the task. In either case, the common carrier is not relieved of its
the incident, the winds were strong and that it was raining hard. However, despite the inclement weather, responsibilities under the contract of carriage.
Matute together with 25 other guests, including Ruelito and his wife, boarded M/B Coco Beach III, which
would bring them back to the Port of Batangas. The boat capsized and Ruelito and his wife died. 10 G.V. FLORIDA TRANSPORT, INC., vs. HEIRS OF ROMEO L. BATTUNG, SR., represented by
DOCTRINE: A company operating a beach resort, which offers ferry services to its guests, is also a ROMEO BATTUNG
common carrier. Its ferry services are so intertwined with its main business as to be properly considered
ancillary thereto. The constancy of respondent’s ferry services in its resort operations is underscored by its E.R Battung was a passenger in Florida bus. He was shot in the head by a passenger in the 4 th row while
having its own Coco Beach boats. And the tour packages it offers, which include the ferry services, may be the driver alighted to check the tires. He was pronounced dead on arrival. Now the heirs filed a claim for
availed of by anyone who can afford to pay the same. These services are thus available to the public. damages based on breach of contract of carriage against Florida. The SC ruled that Battung’s death was
neither caused by any defect in the means of transport or in the method of transporting, or to the negligent
8. First Philippine Industrial Corporation v. CA or willful acts of Florida’s employees in their capacities as driver and conductor. Instead, the case involves
the death of Battung wholly caused by the surreptitious act of a passenger who, after consummating such
E.R. Petitioner is a grantee of a pipeline concession under R.A. 387. Sometime in January 1995, petitioner crime, hurriedly alighted from the vehicle. There is no proper issue on Florida’s duty to observe
applied for mayor’s permit in Batangas. However, the Treasurer required petitioner to pay a local tax extraordinary diligence in ensuring the safety of the passengers transported by it, and the presumption of
based on gross receipts amounting to P956,076.04. In order not to hamper its operations, petitioner paid fault/negligence against Florida under Article 1756 in relation to Articles 1733 and 1755 of the Civil Code
the taxes for the first quarter of 1993 amounting to P239,019.01 under protest. On January 20, 1994, should not apply. No danger was shown to exist in this case so as to impel petitioner or its employees to
petitioner filed a letter-protest to the City Treasurer, claiming that it is exempt from local tax since it is implement heightened security measures to ensure the safety of its passengers. There was also no
engaged in transportation business. The respondent City Treasurer denied the protest, thus, petitioner showing that during the course of the trip, Battung’s killer made suspicious actions which would have
filed a complaint before the Regional Trial Court of Batangas for tax refund. Respondents assert that
forewarned petitioner’s employees of the need to conduct thorough checks on him or any of the 14 Greenstar Express, Inc and Fruto Sayson Jr vs. Universal Robina Corp., and Nissin Universal
passengers. Robina Corp

DOCTRINE: While the law requires the highest degree of diligence from common carriers in the safe E.R: Greenstar’s bus which was driven by Sayson, collided with the URC van, which was driven by
transport of their passengers and creates a presumption of negligence against them, it does not, however, Bicomong. The latter died on the spot. Greenstar filed a complaint against URC to recover damages. URC
make the carrier an insurer of the absolute safety of its passengers. countered that Sayson was running at a high speed when the collision occurred and that Sayson had the
last clear chance to aver the collision. SC ruled that Sayson took no defensive maneuver whatsoever in
#11 Dangwa Trans. Co., Inc., et. al. v. Court of Appeals spite of the fact that the saw Bicomong drive his van in a precarious manner, as far as 250m away, where
Sayson had all the opportunity to prepare and avert a possible collision.
E.R. Cudiamat was attempting to board a bus operated by Dangwa Transportation. When the bus
accelerated forward, Cudiamant fell and was ran over by the rear right tires of the bus. He died and his DOCTRINE: The doctrine of last clear chance provides that where both parties are negligent but the
heirs filed a case for damages against the Dangwa Transportation. negligent act of one is appreciably later in point of time than that of the other, or where it is impossible to
determine whose fault of negligence brought about the occurrence of the incident, the one who had the
DOCTRINE: A public utility bus, once it stops, is in effect making a continuous offer to bus riders. Hence, it last clear opportunity to avoid the impending harm but failed to do so is chargeable with the consequences
is the duty of common carriers to stop their conveyances a reasonable length of time in order to afford arising therefrom. Where both the registered-owner rule and Article 2180 apply, the plaintiff must
passengers an opportunity to board and enter, and they are liable for injuries suffered by boarding first establish that the employer is the registered owner of the vehicle in question. Once the
passengers resulting from the sudden starting up or jerking of their conveyances while they are doing so. plaintiff successfully proves ownership, there arises a disputable presumption that the
The victim herein, by stepping and standing on the platform of the bus, is already considered a passenger requirements of Article 2180 have been proven. As a consequence, the burden of proof shifts to
and is entitled to all the rights and protection pertaining to such a contractual relation. Hence, it has been the defendant to show that no liability under Article 2180 has arisen. This may be done by proof of
held that the duty which the carrier of passengers owes to its patrons extends to persons boarding the cars any of the following:
as well as to those alighting therefrom. 1. That they had no employment relationship with Bicomong; or
2. That Bicomong acted outside the scope of his assigned tasks; or
12) Aboitiz Shipping vs. Court of Appeals 3. That they exercised the diligence of a good father of a family in the selection and supervision of
Bicomong.
E.R.: An hour after the passengers and Viana had disembarked the vessel the crane operator began its
unloading operation. While the crane was being operated, Viana who had already disembarked the vessel 15. Philippine National Railways vs. Ethel Brunty
remembered that some of his cargoes were still loaded there. He went back and while he was pointing to
the crew where his cargoes were, the crane hit him pinning him between the side of the vessel and the E.R.: Rhonda Brunty, Garcia, and the driver, Mercelita were on their way to Baguio. At around 2am in the
crane resulting to his death. morning, Mercelita, driving in the speed of 70 km/hr, overtook a vehicle, to which they collided with the
PNR train driven by Reyes. Mercelita instantly died. Subsequently, Rhonda also died. Garcia suffered
Doctrine: The relation of carrier and passenger continues until the passenger has been landed at the port serious injuries because of the incident. Ethel, the mother of Rhonda, demanded from PNR compensation
of destination and has left the vessel owner’s dock or premises. The relationship will not ordinarily for the death of her daughter. This was ignored by PNR. Ethel and Garcia filed a complaint before the
terminate until the passenger has, after reaching his destination, safely alighted from the carrier’s RTC. Ultimately, the SC ruled that the last clear chance doctrine is not applicable, as it is already
conveyance or had a reasonable opportunity to leave the carrier’s premises. When the accident occurred, established that the proximate cause is the negligence of PNR. Whether there was contributory negligence
the victim was in the act of unloading his cargoes, which he had every right to do, from petitioner’s vessel. on the part of Mercelita? The Court ruled in the affirmative. To hold a person as having contributed to his
A carrier is duty bound not only to bring its passengers safely to their destination but also to afford them a injuries, it must be shown that he performed an act that brought about his injuries in disregard of warning
reasonable time to claim their baggage. Consequently, the victim Anacleto Viana is still deemed a or signs of an impending danger to health and body. Mercelita should not have driven the vehicle the way
passenger of said carrier at the time of his tragic death. he did, however, contributory negligence is still not applicable to Ethel. The records are bereft of proof as
to the relationship between Mercelita (the driver) and Rhonda. Thus, contributory negligence is not
#13 LA MALLORCA vs CA and MARIANO BELTRAN applicable, which generally had the effect of mitigating liability.

E.R. After alighting from the Pambusco bus owned by La Mallorca, the Beltran family stayed in a shaded 16) Sealoader Shipping Corp. vs. Grand Cement Mfg. Corp
spot near the bus as Mariano returned to the bus to retrieve the bayong he left, without him knowing that
his daughter followed him. While Beltran was getting his bag, the bus suddenly moved without warning, so E.R. Sealoader executed a Time Charter Party Agreement with Joyce Launch for the chartering of MT
Beltran jumped off. However, his daughter was run over. La Mallorca denied liability saying there was no Viper in order to tow its unpropelled barges. Sealoder entered into a contract with Grand Cement for the
contract of carriage anymore since the family was no longer on board the bus. The SC held that carrier loading of cement clinkers and the delivery thereof to Manila. Sealoder’s barge arrived at the wharf of
relationship does not cease at the moment passenger alights from the carrier BUT it continues until the Grand Cement tugged by MT Viper. It was not immediately loaded as the employees of Grand Cement
passenger has had a reasonable time/ opportunity to leave the carrier’s premises. And, what is a were loading another vessel. Typhoon Bising struck Cebu area. The barge was still docked at the wharf of
reasonable time or a reasonable delay within this rule is to be determined from all the Grand Cement. As it became stronger, MT Viper tried to tow the barge away but it was unsuccessful
circumstances. because the towing line connecting the vessels snapped since the mooring lines were not cast off, which is
the ultimate cause. Hence, the barge rammed the wharf causing significant damage.
Doctrine: Sealoader is liable for its negligence. First because it was not equipped with a radio or a E.R. Vallarata is a holder of a CPC. Gonzales purchased Vallarta’s jeep covered by the CPC but didn’t
navigational facility and it failed to monitor the prevailing weather conditions. Second, it cannot pass the register the jeep in his name nor secure his own CPC. The jeep collided w/ the truck owned by Lim (the
responsibility of casting off the mooring lines because the people at the wharf could not just cast off the truck was the erring vehicle). Resp. Gonzales filed a complaint for damages against owner Lim and Truck
mooring lines without any instructions from the crew of the vessel. It should have taken the initiative to cast Driver Gunnaban. Lim alleged that Gonzales is not the real party-in-interest since the jeep and CPC was
off the mooring lines early on. With regard to Grand Cement’s contributory negligence, the court found that still under Vallarta. SC ruled in favor of Gonzales since the evil sought to be prevented in enjoining the
it was not guilty thereof. It had timely informed the barge of the impending typhoon and directed the kabit system doesn’t exist (see doctrine). Neither Vallarta nor Gonzales was being held liable for any
vessels to move to a safer place. Sealoader had the responsibility to inform itself of the prevailing weather damages. And it was actually Gonzales who suffered damage and not the other party [erring party]
conditions in the areas where its vessel was to sail.
DOCTRINE: Riding public was not bothered nor inconvenienced at the very least by the illegal
#17 LARRY ESTACION V. NOE BERNARDO arrangement of Gonzales and Vallarta. On the contrary, it was Gonzales who had been wronged and was
seeking compensation for the damage done to him. Certainly, it would be the height of inequity to deny
E.R. Respondent Noe boarded a Ford Fiera passenger jeepney driven by respondent Quinquillera, owned him his right. KABIT SYSTEM: An arrangement whereby a person who has been granted a certificate of
by respondent Bandoquillo. When the Fiera was already full respondent Noe stood on the left rear carrier public convenience allows other persons who own motor vehicles to operate them under his license,
of the vehicle. While the Fiera was picking up a passengers in San Jose, Negros Oriental it was hit by an sometimes for a fee or percentage of the earnings. Although the parties to such an agreement are not
Isuzu cargo truck, owned by petitioner Estacion and driven by Gerosano crushing respondent Noe’s legs outrightly penalized by law, the kabit system recognized as being contrary to public policy and void under
and feet which cause the amputation of his leg. Hence, respondent Noe filed a complaint for damages CC Art. 1409. One primary factor considered in the granting of the CPC is the financial capacity of the
arising from quasi delict against petitioner Estacion and his driver Gerosano. The RTC ordered defendants holder of the license, so that liabilities arising from accidents may be duly compensated. The thrust of the
Gerosano and Estacion to pay actual damages and moral damages. Which was affirmed by CA. SC Said law in enjoining the kabit system is not so much as to penalize the parties but to identify the person upon
that respondent Noe was also guilty of contributory negligence. Because respondent Noe’s act of standing whom responsibility may be fixed in case of an accident with the end view of protecting the riding public.
on the rear carrier of the Fiera exposing himself to bodily injury is negligence on his part. Since there was The policy LOSES its force IF the public at large is NOT deceived, must less involved.
contributory negligence on the part of respondent Noe, petitioner Estacion’s liability should be mitigated in
accordance with Article 2179 of the Civil Code. 20) Baliwag Transit Inc v. Court of Appeals

Doctrine: Noe’s act of standing on the rear carrier of the Fiera exposing himself to bodily injury is E.R.: Martinez claims that he is employed by both Baliwag Transit and Baliwag Transit Inc (BTI) He
negligence on his part. Contributory negligence is conduct on the part of the injured party, contributing as alleged that his salaries were deducted for the purpose of SSS contributions. BTI denied his allegations
a legal cause to the harm he has suffered, which falls below the standard to which he is required to and claimed that he is not their employee and that his employer is actually Baliwag Transit. SC ruled that
conform for his own protection. both bus lines operated under their own franchises but opted to retain the firm name "Baliwag Transit" with
slight modification, by the inclusion of the word "Inc." in the case of herein petitioner, obviously to take
18) Travel & Tours Advisers, Inc. v. Alberto Cruz, Sr. advantage of the goodwill such firm name enjoys with the riding public. However, the issuance of the same
SSS ID does not necessarily connote the existence of a kabit system. The determining factor, therefore, is
E.R. Respondent Hernandez was driving his passenger jeepney when a passenger bus driven by the possession of a franchise to operate which negates the existence of the "Kabit System"
Calaycay and owned by petitioner Travel and Tours hit the rear portion of the jeepney causing it to ram
into a tree. This resulted to the death of the son of respondent Cruz and the serious physical injuries of 21. Teja Marketing v. IAC and Pedro Nale
respondent Muñoz. Respondents then filed a complaint for damages against Calaycay and petitioner. SC
held that it was the negligence of Calaycay that was the proximate cause of the collision and the petitioner ER: Pedro Nale purchased a tricycle from Teja Marketing on instalment basis. Teja Marketing has also a
was not able to present evidence that would show otherwise. Furthermore, petitioner was not able to prove transportation line or franchise for tricycle. Nale also bought the tricycle so that the tricycle will be attached
that it exercised the required diligence needed in the selection and supervision of its employee, hence, to Teja’s franchise (makiki-kabit si Nale). When Nale defaulted in payment, Teja demanded payment for
that it can be held jointly and severally liable for such damages. Nevertheless, petitioner and its driver are the balance. SC ruled that, among others, kabit system is void and inexistent contract by reason of public
not solely liable for the damages caused to the victims because at the time of the vehicular accident, the policy. Thus, it is a fundamental principle that the court will not aid either party to enforce an illegal
jeepney was in violation of its allowed route, hence, the owner and driver of the jeepney likewise, are guilty contract, but will leave both where it finds them. The parties are in pari delicto. No action arises out of illicit
of negligence. The petitioner must thus be held liable only for the damages actually caused by his bargain.
negligence. It is, therefore, proper to mitigate the liability of the petitioner and its driver. The heirs of
Alberto Cruz, Jr. shall recover damages of only 50% of the award from petitioner and its driver, while the #22 Lita Enterprises, Inc. vs Second Civil Cases Division, IAC, Nicasio Ocampo, and Francisca
other 50% shall be bourne by respondent Hernandez (jeep). Garcia

DOCTRINE: “When the plaintiff’s negligence was the immediate and proximate cause of his injury, he E.R.: Resp. spouses bought 5 cars in order to use them as taxicabs. Since they did not have any
cannot recover damages. But if his negligence was only contributory, the immediate and proximate cause franchise, they used petitioner’s certificate of public convenience at a monthly rental. But 2/5 cars were
of the injury being the defendant's lack of due care, the plaintiff may recover damages, but the courts shall levied and sold at public auction due to a writ of execution in a damages case filed against one of the
mitigate the damages to be awarded.” drivers. This prompted respondent spouses to recover the remaining cars but petitioner refused unless it
was paid its monthly rental in arrears. The SC said that the arrangement was a “kabit system” and this is
19) Abelardo Lim And Esmadito Gunnaban vs. CA, et. al., contrary to public policy, thus, a void contract. It leaves both parties where they are by reason of the in pari
delicto doctrine.
 under the boundary system. This is also to protect the riding public from reckless and irresponsible drivers
23 Oscar Villamaria, Jr. vs. Court of Appeals and to ensure that the damages will be paid for any accident they might cause.

E.R.: Villamaria is the owner of Villamaria motors (assemble of jeepneys with franchise to operate) 4 DOCTRINE: The owner of a public vehicle who operates it under the boundary system is not exempt from
jeepneys were operated by employing drivers (Bustamante is one of them; pays 450 as boundary). liability according to the Public Service Law. This is to protect the riding public from reckless and
Apparently, Villamaria agreed to sell the jeep to Bustamante under the boundary- hulog system where irresponsible drivers whose earnings depends largely upon the number of trips they make and, hence, the
Bustamante will still pay the 450 boundary plus 100 pesos (550). The parties also executed a kasunduan speed at which they drive; and practically, most if not all of them are in no position to pay the damages
where the failure to pay daily hulog for one week= return of vehicle. Bustamante eventually failed to pay, they might cause.
Villamaria took back the jeepney driven by Bustamante and barred the latter from driving the vehicle.
Bustamante filed illegal dismissal. SC: Under this system, the owner/operator exercises control and #26 Primo E. Caong, Jr., et. al. vs. Avelino Regualos
supervision over the driver. Under the boundary-hulog scheme incorporated in the Kasunduan, a dual
juridical relationship was created between petitioner and respondent: that of employer-employee and E.R. Petitioners were employed by respondent under a boundary agreement. When petitioners failed to
vendor-vendee. The Kasunduan did not extinguish the employer-employee relationship of the parties pay the full amount of the boundary fee they were barred from using the jeepneys. SC ruled there is an
extant before the execution of said deed. employer-employee relationship. Under a boundary scheme, the driver remits the boundary and keeps the
amount in excess thereof. Thus, on a day when there are many passengers along the route, it is the driver
DOCTRINE: The boundary system is a scheme by an owner/operator engaged in transporting passengers who benefits. It would be unfair then if, during the times when passengers are scarce, the owner/operator
as a common carrier to primarily govern the compensation of the driver, that is, the latters daily earnings will be made to suffer by not getting the full amount of the boundary. Unless clearly shown or explained by
are remitted to the owner/operator less the excess of the boundary which represents the driver’s an event that irregularly and negatively affected the usual number of passengers within the route, the
compensation. Under this system, the owner/operator exercises control and supervision over the driver. scarcity of passengers should not excuse the driver from paying the full amount of the boundary.
Respondents policy of suspending drivers who fail to remit the full amount of the boundary was fair and
The management of the business is still in the hands of the owner/operator, who, being the holder of the reasonable under the circumstances
certificate of public convenience, must see to it that the driver follows the route prescribed by the
franchising and regulatory authority, and the rules promulgated with regard to the business operations. 27. HERMINIO MARIANO, JR. v. ILDEFONSO C. CALLEJAS & EDGAR DE BORJA
The fact that the driver does not receive fixed wages but only the excess of the boundary given to the
owner/operator is not sufficient to change the relationship between them. Indubitably, the driver performs E.R. Dra. Mariano rode a Celyrosa Bus bound for Tagaytay. The said bus was owned by Ildefonso and
activities which are usually necessary or desirable in the usual business or trade of the owner/operator. was then driven by Edgar. While the bus was traversing Aguinaldo Highway, it collided with a Manila-
bound truck. Due to the impact, the fell on its right side and then caused the death of Dra. Mariano.
24 PAGUIO CORP vs NLRC and WILFREDO MELCHOR Herminio, the husband of Dra. Mariano, sued Callejas and de Borja for breach of contract of carriage for
their failure to transport his wife safely to her destination. Respondents denied liability saying that the
E.R. Complainant Melchor was hired by PTC as a taxi driver under the boundary system. He was advised proximate cause of the accident was the recklessness of the driver of the trailer truck which bumped their
to stop working and have a rest after a car accident involving the taxi unit he was driving. He was told by bus while allegedly at a halt on the shoulder of the road in its rightful lane.
the PTC that his service was no longer needed. Then the complaint for illegal dismissal was raised. The
petitioner concludes that he had no control over the number of hour’s private respondent had to work and DOCTRINE: The death of a passenger gives rise to a presumption of fault on the part of the carrier.
the routes he had to take; therefore no employer-employee relationship exists. However, such can be rebutted by a showing that the carrier exercised extraordinary diligence or
that the injury was due to force majeure. Here, the totality of evidence shows that the death of
DOCTRINE: Boundary system is that of employer-employee and not of lessor-lessee. Under the petitioner's spouse was caused by the reckless negligence of the driver of the truck which lost its brakes
“boundary system” the drivers do not receive fixed wages; all the excess in the amount of boundary was and bumped the Celyrosa Bus. The court ruled that the carrier cannot be faulted with negligence. As proof
considered his income but it is not sufficient to withdraw the relationship between them from that of thereof, the court noted the
employer and employee. Private respondents were employees because they had been engaged to
perform activities which were usually necessary or desirable in the usual trade or business of the 28. Cortel and Yellow Bus Line, Inc. v. Gepaya-Lim
employer. The petition was dismissed, the private respondent was entitled for the claim of damages and
illegal dismissal. E.R. An accident occurred between a bus operated by Yellow Bus Line and driven by Eddie Cortel, and a
motorcycle driven by SPO3 Rober Lim. It was found that the motorcycle and bus were driving in the same
#25 Hernandez vs. Dolor direction when the motorcycle was hit from the back by the bus. Upon impact, Lim was thrown upward and
then slammed into the bus, hitting the base of its right windshield wiper. The motorcycle entangled with the
ER: Dolor was driving an owner-type jeepney towards Anilao, Batangas when his vehicle collided with a broken bumper of the bus.
passenger jeepney driven by Gonzales and owned by Hernandes spouses. Death and physical injuries
were sustained as well as wreckage from the owner-type jeep. Dolor filed an action for damages against DOCTRINE: In this case, Cortel had the exclusive control of the bus, including its speed. The bus and the
Gonzales and Hernandez spouses. The latter claim no liability as Gonzales is not their driver-employee as motorcycle were running in the same traffic direction and as such, the collision would not have happened
their relationship is that of a lessor-lessee since Gonzales pays them a daily rental of P150 for the use of without negligence on the part of Cortel. It was established that the collision between the bus and the
the jeepney. SC ruled that Gonzales is an employee of Hernandez spouses and that the latter operates motorcycle caused Lim's death. Aside from bare allegations that petitioners failed to prove, there was
nothing to show that Lim had contributory negligence to the accident. The rule is when an employee
causes damage due to his own negligence while performing his own duties, there arises a presumption the registered owner of the bus is Lim, the actual owner was SPO1 Enriquez, who had the bus attached
that his employer is negligent. This presumption can be rebutted only by proof of observance by the with Mayamy Transport under the “kabit-system”
employer of the diligence of a good father of a family in the selection and supervision of its employees. In
this case, Yellow Bus Line failed to prove that it exercised due diligence of a good father of a family in the DOCTRINE: In so far as third persons are concerned, the registered owner of the motor vehicle is the
selection and supervision of its employees. The elements of res ipsa loquitur are: (1) the accident is of employer of the negligent driver, and the actual employer is considered merely as an agent of such owner.
such character as to warrant an inference that it would not have happened except for the defendant's Thus, whether there is an employer-employee relationship between the registered owner and the driver is
negligence; (2) the accident must have been caused by an agency or instrumentality within the exclusive irrelevant in determining the liability of the registered owner who the law holds primarily and directly
management or control of the person charged with the negligence complained of; and (3) the accident responsible for any accident, injury or death caused by the operation of the vehicle in the streets and
must not have been due to any voluntary action or contribution on the part of the person injured. highways. The general rule is that if the employer shows to the satisfaction of the court that in the selection
and supervision of his employee he has exercised the care and diligence of a good father of a family, the
#29 CARAVAN TRAVEL AND TOURS INTERNATIONAL, INC. v. ERMILINDA R. ABEJAR presumption is overcome and he is relieved of liability. However, with the enactment of the motor vehicle
registration law, the defenses available under Article 2180 of the Civil Code - that the employee acts
E.R.: A Mitsubishi van owned by Caravan hit Reyes. Espinosa, a witness, went to her aid, loaded her in beyond the scope of his assigned task or that it exercised the due diligence of a good father of a family to
the back of the van, and instructed the driver, Bautista, to bring her to the hospital. This, Bautista did not prevent damage – are no longer available to the registered owner of the motor vehicle, because the motor
do. Nonetheless, an unidentified civilian brought Reyes to the hospital, where she died two days after the vehicle registration law, to a certain extent, modified Article 2180.
accident. Reyes’ paternal aunt, Abejar, sought damages against Bautista and Caravan, alleging that
Bautista was Caravan’s employee and that Caravan is the registered owner of the van. Issue: Whether #31 ACE NAVIGATION CO., INC. v. FGU INSURANCE CORPORATION and PIONEER INSURANCE
Caravan should be held liable as an employer, pursuant to NCC 2180, even if Abejar did not adduce proof AND SURETY CORPORATION
that Bautista acted within the scope of his authority? Yes. It was sufficient that petitioner was the
registered owner of the van that hit Reyes. SC applied the registered-owner rule in a manner that E.R. Cardia shipped cement on board M/V Pakarti Tiga to be delivered to Heinrich. When the shipment
harmonized it with NCC 2180 and 2176. [refer to Doctrine] Here, Abejar presented a copy of the van’s OR- arrived, several bags were in bad order. Heinrich claimed from the insurance companies, FGU and
CR showing Caravan as the owner. Caravan did not dispute its ownership. Hence, a presumption that the Pioneer. The insurers now sued the owner, charterers, and the shippers for reimbursement. The Court
requirements in NCC 2180 have been satisfied arose. The burden of evidence shifted to Caravan to show held that PAKARTI, SHINWA, KEE YEH and its agent, SKY, solidarity liable for 70% of the claim, with the
that it incurred no liability under Article 2180 by showing ANY of the ff: remaining 30% to be shouldered by CARDIA as shipper. SC: In this case, the original parties to the bill of
lading are: (a) the shipper CARDIA; (b) the carrier PAKARTI; and (c) the consignee HEINDRICH.
However, by virtue of their relationship with PAKARTI under separate charter arrangements, SHINWA,
That it had no employment Caravan admitted that Bautista was its
KEE YEH and its agent SKY likewise became parties to the bill of lading. In the same vein, Ace
relationship with Bautista employee at the time of the accident
Navigation, as agent of CARDIA, also became a party to the said contract of carriage. However, Ace
That Bautista acted outside the Caravan’s supervisor testified that she had Navigation is a mere agent of Cardia and not a ship agent (entrusted with the provisioning of a vessel, or
scope of his assigned tasks no knowledge why Bautista was at the place who represents her in the port in which she may be found.)
of incident when it occurred.
DOCTRINE: A bill of lading is defined as “an instrument in writing, signed by a carrier or his agent,
That it exercised the diligence of a Caravan presented copies of company rules. describing the freight so as to identify it, stating the name of the consignor, the terms of the contract for
good father of a family in the These were insufficient; no proof of actual carriage, and agreeing or directing that the freight to be delivered to the order or assigns of a specified
selection and supervision of compliance. person at a specified place.” It operates both as a receipt and as a contract. As such, it shall only be
Bautista binding upon the parties who make them, their assigns and heirs.

32) MOF Company, Inc. vs. Shin Yang Brokerage Corp.

DOCTRINE: The plaintiff may first prove the employer's ownership of the vehicle involved in a mishap by E.R. Halla shipped to Manila secondhand cars and other articles on board the vessel Hanjin Busan. The
presenting the vehicle's registration in evidence. Thereafter, a disputable presumption that the bill of lading was prepared by the carrier Hanjin where Shin Yang was named as the consignee and
requirements for an employer's liability under Article 2180 of the Civil Code have been satisfied will arise. indicated that payment was on a "Freight Collect" basis (meaning the consignee/receiver of the goods
The burden of evidence then shifts to the defendant to show that no liability under Article 2180 has would be the one to pay for the freight and other charges). When the shipment arrived in Manila MOF,
ensued. Hanjin’s exclusive general agent in the Philippines, demanded the payment from Shin Yang. Shin Yang
refused to pay the freight and other charges. Shin Yang is saying that it is not the ultimate consignee but
30 Mariano C. Mendoza and Elvira Lim vs. Spouses Leonora Gomez and Gabriel Gomez merely the consolidator/forwarder. Shin Yang contends that the fact that its name was mentioned as the
consignee of the cargoes did not make it automatically liable for the freightage because it never benefited
E.R. An Isuzu truck owned by Leonora and driven by Perez was hit by a Mayamy Bus registered under the from the shipment. SC: Shin Yang consistently denied in all of its pleadings that it authorized Halla
name of Lim and driven by Mendoza. Information for reckless imprudence was filed against Mendoza, Trading, Co. to ship the goods on its behalf; or that it got hold of the bill of lading covering the shipment or
however, he eluded the arrest. Hence, Sps. Gomez filed a complaint for damages against Mendoza and that it demanded the release of the cargo. MOF has the burden to controvert all these denials, it being
Lim. The reports stated that the truck was hit by the bus, and Mendoza tried to escape by speeding away, insistent that Shin Yang asserted itself as the consignee and the one that caused the shipment of the
but he was apprehended in Katipunan. As a result of the incident, Perez, as well as the helpers on board goods to the Philippines. There is also nothing in the records which would indicate that Shin Yang was an
the truck, sustained injuries necessitating medical treatment amounting. Mendoza argued that although
agent of Halla Trading Co. or that it exercised any act that would bind it as a named consignee. Thus, the benefits under the POEA-SEC is the same species as the workmen's compensation claims under the
CA correctly dismissed the suit for failure of petitioner to establish its cause against respondent. Labor Code – both of which belong to a different realm from that of Maritime Law. Akin to the death
benefits under the Labor Code, these benefits under the POEA-SEC are given when the employee dies
Doctrine: The bill of lading is oftentimes drawn up by the shipper/consignor and the carrier without the due to a work-related cause during the term of his contract. The death benefits granted under the POEA-
intervention of the consignee. However, the latter can be bound by the stipulations of the bill of lading and SEC is not due to the death of a passenger by or through the misconduct of the captain or master of the
becomes a party to the contract when a) there is a relation of agency between the shipper or consignor ship; nor is it the liability for the loss of the ship as result of collision; nor the liability for wages of the crew.
and the consignee or b) when the consignee demands fulfillment of the stipulation of the bill of lading It is a liability created by contract between the seafarers and their employers
which was drawn up in its favor or c) the unequivocal acceptance of the bill of lading delivered to the
consignee, with full knowledge of its contents. DOCTRINE: Article 837 applies the limited liability rule in cases of collision. Meanwhile, Articles 587 and
590 embody the universal principle of limited liability in all cases wherein the shipowner or agent may be
33 Designer Baskets, Inc. (DBI) vs. Air Sea Transport, Inc. (ASTI) and Asia Cargo Container Lines, properly held liable for the negligent or illicit acts of the captain. These articles precisely intend to limit the
Inc. (ACCLI) liability of the shipowner or agent to the value of the vessel, its appurtenances and freightage earned in the
voyage, provided that the owner or agent abandons the vessel. When the vessel is totally lost, in which
E.R. Ambiente ordered from DBI 223 cartons of assorted wooden items. DBI delivered the shipment to case abandonment is not required because there is no vessel to abandon, the liability of the shipowner or
ACCLI and to acknowledge receipt, ACCLI made triplicate copies of BOL. DBI retained possession of the agent for damages is extinguished. Nonetheless, the limited liability rule is not absolute and is without
BOL. Ambiente and ASTI entered an Indemnity agreement where ASTI will deliver the goods to Ambiente exceptions. It does not apply in cases: (1) where the injury or death to a passenger is due either to the
and in exchange, Ambiente undertook to indemnify and hold ASTI free from any liability as a result of the fault of the shipowner, or to the concurring negligence of the shipowner and the captain; (2) where the
shipment. ASTI released the shipment without DBI’s knowledge and without DBI receiving payment. DBI vessel is insured; and (3) in workmen's compensation claims.
made several demands to Ambiente but went unheeded. DBI then filed a complaint against ASTI and
ACCLI for releasing the shipment without surrendering the BOL. It impleaded Ambiente in its amended 35. Philam Insurance Company vs. Heung-A Shipping
complaint. The SC ruled that ASTI and ACCLI are not liable because there is no obligation on the part of
ASTI and ACCLI to release the goods only upon the surrender of the original bill of lading. What the BOL E.R.: Novartis imported from Jinsuk 19 pallets of materials. The shipment was insured by Novartis to
requires is: If required by the Carrier this Bill of Lading duly endorsed must be surrendered in Philam. Jinsuk then engaged the services of Protop to forward the goods. Protop then shipped the cargo
exchange for the Goods of delivery order. to Dongnama, which in turn loaded it to M/V Hueng-A, operated by Hueng-A, who’s ship agent in the Phil.
was Wallen. When the goods arrived in the Philippines, it was discovered that the boxes were wet and
DOCTRINE: G.R. Upon receipt of the goods, the consignee surrenders the bill of lading to the damped. Novartis rejected the shipment. Novartis then filed its insurance claim with Philam, which the
carrier and their respective obligations are considered canceled. The law, however, provides two latter granted. Philam was then subrogated to the rights of Novartis. SC ruled that Protop (forwarder),
exceptions where the goods may be released without the surrender of the bill of lading because Hueng-A (common-carrier) and Wallen (ship agent) are liable. However, the liability was limited to $8,500
the consignee can no longer return it. because they failed to declare the value in the bill of lading, pursuant to COGSA. When the shipper fails to
EXNs: When the bill of lading gets lost or for other cause. In either case, the consignee must issue declare the value of the goods in the bill of lading COGSA provides that the carrier nor the ship shall be or
a receipt to the carrier upon the release of the goods. Such receipt shall produce the same effect become liable for any loss or damage to or in connection with the transportation of goods in an amount
as the surrender of the bill of lading. exceeding $500 per package.

34) Phil -Nippon Kyoei, Corp. vs. Rosalia T. Gudelosao Doctrine: Under Article 1753 of the Civil Code, the law of the country to which the goods are to be
transported shall govern the liability of the common carrier for their loss, destruction or deterioration. In all
E.R.: Petitioner (PNKC) is a domestic shipping corporation which purchased a "Ro-Ro" passenger/cargo matters not regulated by the Civil Code, the rights and obligations of common carriers shall be governed
vessel "MV Mahlia" in Japan. For the vessel’s one month conduction voyage from Japan to the by the Code of Commerce and by special laws, such as the COGSA.
Philippines, PNKC, as local principal, and Top Ever Marine Management Maritime Co., Ltd. (TMCL), as
foreign principal, hired Edwin Gudelosao, Virgilio Tancontian, and 6 other crewmembers through the local 36) Asian Terminals, Inc. v. Philam Insurance Co.
manning agency of TMCL, Top Ever Marine Management Philippine Corporation (TEMMPC). TEMMPC,
through their Pres. and GM. Capt. Orbeta signed separate contracts of employment. PNKC secured a E.R. 120 units of brand new trucks of Nissan Pickup Truck are to be delivered from Japan to Manila by
Marine Insurance Policy from South Sea Surety & Insurance Co., Inc. (SSSICI) over the vessel for P10.8M Nichime Corp to Universal Motors. These trucks were insured by the respondent Philam Insurance. Such
against loss, damage, and third party liability or expense, arising from the occurrence of the perils of the cars were shipped by Westwind (shipping corp) thru its arrastre operator petitioner Asian Terminals Inc.
sea for the voyage of the vessel from Onomichi, Japan to Batangas, Philippines. Marine Insurance Policy (ATI). When the trucks were laden to the pier, it was found out that two packages in the cargoes are
included Personal Accident Policies for the crewmembers for P3.2M each in case of accidental death or dented and broken. The brokerage company R.F. Revilla Customs delivered the cars to Universal Motor’s
injury. However, while still within Japanese waters, the vessel sank due to extreme bad weather condition warehouse. Informing of such defect and dented trucks, Universal Motors declared such trucks as a total
with only the Chief Engineer as survivor. Respondents, as heirs and beneficiaries of Gudelosao and loss and cannot be anymore used. This resulted Universal to file a claim against Westwind, ATI and
Tancontian, filed separate complaints for death benefits and other damages against PNKC, TEMMPC, Revilla brokerage firm. SC: Both Westwind and ATI are jointly and severally liable. While the staff of ATI
Capt. Orbeta, TMCL, and SSSICI, with NLRC. WON the doctrine of limited liability is applicable – NO, undertook the physical unloading of the cargoes from the carrying vessel, Westwind’s duty officer
not applicable to claims under POEA-SEC. The benefits being claimed are not dependent upon whether exercised full supervision and control over the entire process.
there is total loss of the vessel, because the liability attaches even if the vessel did not sink, thus,
TEMMPC and TMCL should not have been absolved based on the limited liability rule. The claim for death
DOCTRINE: Section 2 of the COGSA provides that under every contract of carriage of goods by the sea,
the carrier in relation to the loading, handling, stowage, carriage, custody, care and discharge of such ER: Upon Arrival in LA Airport, Jesus was interrogated by the Immigration because an employee of
goods, shall be subject to the responsibilities and liabilities and entitled to the rights and immunities set Northwest refused to verify and validate his ticket which reflected a wrong date. Hence, he was granted
forth in the Act. Section 3 (2) thereof then states that among the carrier’s responsibilities are to properly only a 12-day stay in the US, instead of the usual 6 months. When about to depart from LA, the Fernandos
load, handle, stow, carry, keep, care for and discharge the goods carried. missed their flight because an employee of Northwest pulled them out of the queue when they failed to
present a paper ticket. Sps. Fernando filed a case for damages. SC: The Fernandos' cause of action
#37 EDNA DIAGO LHUILLER V. BRITISH AIRWAYS against Northwest stemmed from a breach of contract of carriage. When an airline issues a ticket to a
passenger confirmed for a particular flight on a certain date, a contract of carriage arises. The passenger
E.R. Petitioner Lhuillier took respondent BA’s flight 548 from London to Italy. Once on board, she then has every right to expect that he would fly on that flight and on that date. If he does not, then the
requested one of the flight attendants, to assist her in her luggage. However, the flight attendant refused. carrier. opens itself to a suit for breach of contract of carriage. Having proven the existence of a contract of
Thereafter, when the plane was about to land in Rome another flight attendant singled her out from all the carriage between Northwest and the Fernandos, and the fact of non-performance by Northwest of its
passengers to lecture on plane safety making her appear to be stupid. Hence, petitioner Lhuillier filed, obligation as a common carrier, it is clear that Northwest breached its contract of carriage with the
before the RTC Makati, a complaint for damages against respondent BA. Respondent BA filed a motion to Fernandos. Thus, Northwest opened itself to claims for compensatory, actual, moral and exemplary
dismiss on grounds of lack of jurisdiction claiming that only the courts of London, UK or Rome, Italy, have damages, attorney's fees and costs of suit.
jurisdiction pursuant to Article 28 (1) of the Warsaw Convention. SC said that the Warsaw Convention Doctrine: A contract to transport passengers is quite different in kind and degree from any other
applies in this case, thus, the RTC Makati has no jurisdiction over the case. Because respondent BA is a contractual relation because of the relation which an air-carrier sustains with the public. Its
British corporation domiciled in London, UK with London as its principal place of business. Hence, under business is mainly with the travelling public. It invites people to avail of the comforts and
the 1st and 2nd jurisdictional rules, the petitioner Lhuillier may bring her case before the courts of London in advantages it offers. The contract of air carriage, therefore, generates a relation attended with a
the UK. The ticket was issued in Rome, Italy. Consequently, under the 3 rd jurisdictional rule, the petitioner public duty. Neglect or malfeasance of the carrier's employees, naturally, could give ground for an
Lhuillier has the option to bring her case before the courts of Rome in Italy. Finally, the place of destination action or damages.
is Rome, Italy, Accordingly, petitioner Lhuillier may bring her action before the courts of Rome, Italy.
40) Cathay Pacific Airways v. Spouses Vazquez
DOCTRINE: Under Article 1 of the Warsaw Convention, when the place of departure and the place of
destination in a contract of carriage are situated within the territories of 2 High Contracting Parties E.R.: Sps Vazquez were upgraded to first class over their vehement objections, as they preferred to stay
(signatories to the convention), said carriage is deemed an "international carriage". Under Article 28(1) of in business class with their friends. Claiming to be humiliated by the ground attendant, they filed a case for
the Warsaw Convention, the plaintiff may bring the action for damages before – damages based on the breach of contract of carriage. RTC, CA, and SC all ruled in their favor. The
1. the court where the carrier is domiciled; Vazquezes should have been consulted first whether they wanted to avail themselves of the privilege or
2. the court where the carrier has its principal place of business; would consent to a change of seat accommodation before their seat assignments were given to other
3. the court where the carrier has an establishment by which the contract has been made; or passengers.
4. the court of the place of destination.
DOCTRINE: Breach of contract is defined as the failure without legal reason to comply with the terms of a
38) PAL vs. Hon. Adriano Savillo contract. By insisting on the upgrade, Cathay breached its contract of carriage with the Vazquezes.

E.R. Private respondent Griño, who will participate in a golf tournament in Jakarta, and several
companions purchased their tickets from PAL (Manila-Singapore-Jakarta-Singapore-Manila). They were
informed that Singapore Airlines will take them from Singapore to Jakarta. When they proceeded to check
in for their flight from Singapore to Jakarta, Singapore Airlines rejected their tickets because it was not
endorsed by PAL. Griño was not able to contact PAL so they were stranded at the airport in Singapore.
They were then forced to buy tickets from another airline. Upon return to the PH, he sent a demand letter
to PAL and to Singapore Airlines. However, both airlines disowned liability prompting Griño to file a
complaint for damages. PAL, instead of filing an Answer, filed a motion to dismiss on the ground that the
complaint was already barred by prescription under the Warsaw Convention. SC held that these claims are
covered by the Civil Code provisions on tort and not within the purview of the Warsaw Convention so the
complaint has not yet prescribed, since, it was filed within the 4-yr prescriptive period under the Civil Code.
The present case involves a special species of injury resulting from the failure of PAL and/or Singapore
Airlines to transport private respondent from Singapore to Jakarta.

DOCTRINE: An action based on these allegations will not fall under the Warsaw Convention, since the
purported negligence on the part of PAL did not occur during the performance of the contract of carriage
but days before the scheduled flight.

39. Sps Jesus and Elizabeth Fernando v. Northwest Airlines