FIRST DIVISION

[G.R. No. 138334. August 25, 2003]

ESTELA L. CRISOSTOMO, petitioner, vs. THE CORT O! A""EALS #$% CARA&AN TRA&EL ' TORS INTERNATIONAL,
INC., respondents.
( E C I S I O N
)NARES*SANTIAGO, J.+
In May 1991, petitioner Estela L. Crisostomo contracte t!e ser"ices o# responent Cara"an Tra"el an To$rs International, Inc. to
arran%e an #acilitate !er &oo'in%, tic'etin% an accommoation in a to$r $&&e ()e*els o# E$rope+. T!e pac'a%e to$r incl$e t!e
co$ntries o# En%lan, ,ollan, -ermany, .$stria, Liec!stenstein, S*it/erlan an France at a total cost o# 012,344.15. 0etitioner *as
%i"en a 67 isco$nt on t!e amo$nt, *!ic! incl$e air#are, an t!e &oo'in% #ee *as also *ai"e &eca$se petitioner8s niece, Meriam
Menor, *as responent company8s tic'etin% mana%er.
0$rs$ant to sai contract, Menor *ent to !er a$nt8s resience on )$ne 14, 1991 9 a :enesay 9 to eli"er petitioner8s tra"el
oc$ments an plane tic'ets. 0etitioner, in t$rn, %a"e Menor t!e #$ll payment #or t!e pac'a%e to$r. Menor t!en tol !er to &e at t!e
Ninoy .;$ino International .irport <N.I.= on S#tu,%#-, t*o !o$rs &e#ore !er #li%!t on &oar >ritis! .ir*ays.
:it!o$t c!ec'in% !er tra"el oc$ments, petitioner *ent to N.I. on Sat$ray, )$ne 16, 1991, to ta'e t!e #li%!t #or t!e #irst le% o# !er
?o$rney #rom Manila to ,on%'on%. To petitioner8s ismay, s!e isco"ere t!at t!e #li%!t s!e *as s$ppose to ta'e !a alreay eparte
t!e pre"io$s ay. S!e learne t!at !er plane tic'et *as #or t!e #li%!t sc!e$le on )$ne 12, 1991. S!e t!$s calle $p Menor to
complain.
S$&se;$ently, Menor pre"aile $pon petitioner to ta'e anot!er to$r 9 t!e (>ritis! 0a%eant+ 9 *!ic! incl$e En%lan, Scotlan
an :ales in its itinerary. For t!is to$r pac'a%e, petitioner *as as'e ane* to pay @SA1B6.55 or 045,BB1.55 <at t!e t!en pre"ailin%
eCc!an%e rate o# 04D.D5=. S!e %a"e responent @SA355 or 01,9B5.55 as partial payment an commence t!e trip in )$ly 1991.
@pon petitioner8s ret$rn #rom E$rope, s!e emane #rom responent t!e reim&$rsement o# 0D1,241.15, representin% t!e
i##erence &et*een t!e s$m s!e pai #or ()e*els o# E$rope+ an t!e amo$nt s!e o*e responent #or t!e (>ritis! 0a%eant+ to$r.
Despite se"eral emans, responent company re#$se to reim&$rse t!e amo$nt, contenin% t!at t!e same *as nonEre#$na&le.
F1G
0etitioner *as t!$s constraine to #ile a complaint a%ainst responent #or &reac! o# contract o# carria%e an ama%es, *!ic! *as
oc'ete as Ci"il Case No. 94E133 an ra##le to >ranc! 69 o# t!e Re%ional Trial Co$rt o# Ma'ati City.
In !er complaint,
F4G
petitioner alle%e t!at !er #ail$re to ?oin ()e*els o# E$rope+ *as $e to responent8s #a$lt since it i not clearly
inicate t!e epart$re ate on t!e plane tic'et. Responent *as also ne%li%ent in in#ormin% !er o# t!e *ron% #li%!t sc!e$le t!ro$%! its
employee Menor. S!e insiste t!at t!e (>ritis! 0a%eant+ *as merely a s$&stit$te #or t!e ()e*els o# E$rope+ to$r, s$c! t!at t!e cost o#
t!e #ormer s!o$l &e properly setEo## a%ainst t!e s$m pai #or t!e latter.
For its part, responent company, t!ro$%! its Operations Mana%er, Concepcion C!ipeco, enie responsi&ility #or petitioner8s
#ail$re to ?oin t!e #irst to$r. C!ipeco insiste t!at petitioner *as in#orme o# t!e correct epart$re ate, *!ic! *as clearly an le%i&ly
printe on t!e plane tic'et. T!e tra"el oc$ments *ere %i"en to petitioner t*o ays a!ea o# t!e sc!e$le trip. 0etitioner !a only
!ersel# to &lame #or missin% t!e #li%!t, as s!e i not &ot!er to rea or con#irm !er #li%!t sc!e$le as printe on t!e tic'et.
Responent eCplaine t!at it can no lon%er reim&$rse t!e amo$nt pai #or ()e*els o# E$rope+, consierin% t!at t!e same !a
alreay &een remitte to its principal in Sin%apore, Lot$s Tra"el Lt., *!ic! !a alreay &ille t!e same e"en i# petitioner i not ?oin t!e
to$r. Lot$s8 E$ropean to$r or%ani/er, Insi%!t International To$rs Lt., etermines t!e cost o# a pac'a%e to$r &ase on a minim$m
n$m&er o# pro?ecte participants. For t!is reason, it is accepte in$stry practice to isallo* re#$n #or ini"i$als *!o #aile to ta'e a
&oo'e to$r.
F3G
Lastly, responent maintaine t!at t!e (>ritis! 0a%eant+ *as not a s$&stit$te #or t!e pac'a%e to$r t!at petitioner misse. T!is to$r
*as inepenently proc$re &y petitioner a#ter reali/in% t!at s!e mae a mista'e in missin% !er #li%!t #or ()e*els o# E$rope+. 0etitioner
*as allo*e to ma'e a partial payment o# only @SA355.55 #or t!e secon to$r &eca$se !er niece *as t!en an employee o# t!e tra"el
a%ency. Conse;$ently, responent praye t!at petitioner &e orere to pay t!e &alance o# 014,951.55 #or t!e (>ritis! 0a%eant+
pac'a%e to$r.
.#ter $e proceein%s, t!e trial co$rt renere a ecision,
F2G
t!e ispositi"e part o# *!ic! reasH
:,EREFORE, premises consiere, ?$%ment is !ere&y renere as #ollo*sH
1. Orerin% t!e e#enant to ret$rn anIor re#$n to t!e plainti## t!e amo$nt o# Fi#ty T!ree T!o$san Nine ,$nre Ei%!ty
Nine 0esos an Forty T!ree Centa"os <063,9B9.23= *it! le%al interest t!ereon at t!e rate o# t*el"e percent <147=
per ann$m startin% )an$ary 1D, 1994, t!e ate *!en t!e complaint *as #ileJ
4. Orerin% t!e e#enant to pay t!e plainti## t!e amo$nt o# Fi"e T!o$san <06,555.55= 0esos as an #or reasona&le
attorney8s #eesJ
3. Dismissin% t!e e#enant8s co$nterclaim, #or lac' o# meritJ an
2. :it! costs a%ainst t!e e#enant.
SO ORDERED.
F6G
T!e trial co$rt !el t!at responent *as ne%li%ent in erroneo$sly a"isin% petitioner o# !er epart$re ate t!ro$%! its employee,
Menor, *!o *as not presente as *itness to re&$t petitioner8s testimony. ,o*e"er, petitioner s!o$l !a"e "eri#ie t!e eCact ate an
time o# epart$re &y loo'in% at !er tic'et an s!o$l !a"e simply not relie on Menor8s "er&al representation. T!e trial co$rt t!$s
eclare t!at petitioner *as %$ilty o# contri&$tory ne%li%ence an accorin%ly, e$cte 157 #rom t!e amo$nt &ein% claime as re#$n.
Responent appeale to t!e Co$rt o# .ppeals, *!ic! li'e*ise #o$n &ot! parties to &e at #a$lt. ,o*e"er, t!e appellate co$rt !el
t!at petitioner is more ne%li%ent t!an responent &eca$se as a la*yer an *ellEtra"ele person, s!e s!o$l !a"e 'no*n &etter t!an to
simply rely on *!at *as tol to !er. T!is &ein% so, s!e is not entitle to any #orm o# ama%es. 0etitioner also #or#eite !er ri%!t to t!e
()e*els o# E$rope+ to$r an m$st t!ere#ore pay responent t!e &alance o# t!e price #or t!e (>ritis! 0a%eant+ to$r. T!e ispositi"e
portion o# t!e ?$%ment appeale #rom reas as #ollo*sH
:,EREFORE, premises consiere, t!e ecision o# t!e Re%ional Trial Co$rt ate Octo&er 4D, 1996 is !ere&y REVERSED an SET
.SIDE. . ne* ?$%ment is !ere&y ENTERED re;$irin% t!e plainti##Eappellee to pay to t!e e#enantEappellant t!e amo$nt o#
014,951.55, representin% t!e &alance o# t!e price o# t!e >ritis! 0a%eant 0ac'a%e To$r, t!e same to earn le%al interest at t!e rate o# SIK
0ERCENT <D7= per ann$m, to &e comp$te #rom t!e time t!e co$nterclaim *as #ile $ntil t!e #inality o# t!is ecision. .#ter t!is ecision
&ecomes #inal an eCec$tory, t!e rate o# T:ELVE 0ERCENT <147= interest per ann$m s!all &e aitionally impose on t!e total
o&li%ation $ntil payment t!ereo# is satis#ie. T!e a*ar o# attorney8s #ees is DELETED. Costs a%ainst t!e plainti##Eappellee.
SO ORDERED.
FDG
@pon enial o# !er motion #or reconsieration,
F1G
petitioner #ile t!e instant petition $ner R$le 26 on t!e #ollo*in% %ro$nsH
I
It is respect#$lly s$&mitte t!at t!e ,onora&le Co$rt o# .ppeals committe a re"ersi&le error in re"ersin% an settin% asie t!e ecision
o# t!e trial co$rt &y r$lin% t!at t!e petitioner is not entitle to a re#$n o# t!e cost o# $na"aile ()e*els o# E$rope+ to$r s!e &ein% e;$ally,
i# not more, ne%li%ent t!an t!e pri"ate responent, #or in t!e contract o# carria%e t!e common carrier is o&li%e to o&ser"e $tmost care
an eCtraEorinary ili%ence *!ic! is !i%!er in e%ree t!an t!e orinary ili%ence re;$ire o# t!e passen%er. T!$s, e"en i# t!e petitioner
an pri"ate responent *ere &ot! ne%li%ent, t!e petitioner cannot &e consiere to &e e;$ally, or *orse, more %$ilty t!an t!e pri"ate
responent. .t &est, petitioner8s ne%li%ence is only contri&$tory *!ile t!e pri"ate responent Fis %$iltyG o# %ross ne%li%ence ma'in% t!e
principle o# pari elicto inapplica&le in t!e caseJ
II
T!e ,onora&le Co$rt o# .ppeals also erre in not r$lin% t!at t!e ()e*els o# E$rope+ to$r *as not ini"isi&le an t!e amo$nt pai
t!ere#or re#$na&leJ
III
T!e ,onora&le Co$rt erre in not %rantin% to t!e petitioner t!e conse;$ential ama%es $e !er as a res$lt o# &reac! o# contract o#
carria%e.
FBG
0etitioner contens t!at responent i not o&ser"e t!e stanar o# care re;$ire o# a common carrier *!en it in#orme !er
*ron%ly o# t!e #li%!t sc!e$le. S!e co$l not &e eeme more ne%li%ent t!an responent since t!e latter is re;$ire &y la* to eCercise
eCtraorinary ili%ence in t!e #$l#illment o# its o&li%ation. I# s!e *ere ne%li%ent at all, t!e same is merely contri&$tory an not t!e
proCimate ca$se o# t!e ama%e s!e s$##ere. ,er loss co$l only &e attri&$te to responent as it *as t!e irect conse;$ence o# its
employee8s %ross ne%li%ence.
0etitioner8s contention !as no merit.
>y e#inition, a contract o# carria%e or transportation is one *!ere&y a certain person or association o# persons o&li%ate
t!emsel"es to transport persons, t!in%s, or ne*s #rom one place to anot!er #or a #iCe price.
F9G
S$c! person or association o# persons
are re%are as carriers an are classi#ie as pri"ate or special carriers an common or p$&lic carriers.
F15G
. common carrier is e#ine
$ner .rticle 1134 o# t!e Ci"il Coe as persons, corporations, #irms or associations en%a%e in t!e &$siness o# carryin% or transportin%
passen%ers or %oos or &ot!, &y lan, *ater or air, #or compensation, o##erin% t!eir ser"ices to t!e p$&lic.
It is o&"io$s #rom t!e a&o"e e#inition t!at responent is not an entity en%a%e in t!e &$siness o# transportin% eit!er passen%ers
or %oos an is t!ere#ore, neit!er a pri"ate nor a common carrier. Responent i not $nerta'e to transport petitioner #rom one place
to anot!er since its co"enant *it! its c$stomers is simply to ma'e tra"el arran%ements in t!eir &e!al#. Responent8s ser"ices as a tra"el
a%ency incl$e proc$rin% tic'ets an #acilitatin% tra"el permits or "isas as *ell as &oo'in% c$stomers #or to$rs.
:!ile petitioner conceely &o$%!t !er plane tic'et t!ro$%! t!e e##orts o# responent company, t!is oes not mean t!at t!e
latter ipso facto is a common carrier. .t most, responent acte merely as an a%ent o# t!e airline, *it! *!om petitioner $ltimately
contracte #or !er carria%e to E$rope. Responent8s o&li%ation to petitioner in t!is re%ar *as simply to see to it t!at petitioner *as
properly &oo'e *it! t!e airline #or t!e appointe ate an time. ,er transport to t!e place o# estination, mean*!ile, pertaine irectly
to t!e airline.
T!e o&?ect o# petitioner8s contract$al relation *it! responent is t!e latter8s ser"ice o# #,,#$g.$g #$% /#0.1.t#t.$g petitioner8s
&oo'in%, tic'etin% an accommoation in t!e pac'a%e to$r. In contrast, t!e o&?ect o# a contract o# carria%e is t!et,#$s2o,t#t.o$ o#
passen%ers or %oos. It is in t!is sense t!at t!e contract &et*een t!e parties in t!is case *as an orinary one #or ser"ices an not one
o# carria%e. 0etitioner8s s$&mission is premise on a *ron% ass$mption.
T!e nat$re o# t!e contract$al relation &et*een petitioner an responent is eterminati"e o# t!e e%ree o# care re;$ire in t!e
per#ormance o# t!e latter8s o&li%ation $ner t!e contract. For reasons o# p$&lic policy, a common carrier in a contract o# carria%e is
&o$n &y la* to carry passen%ers as #ar as !$man care an #oresi%!t can pro"ie $sin% t!e $tmost ili%ence o# "ery ca$tio$s persons
an *it! $e re%ar #or all t!e circ$mstances.
F11G
.s earlier state, !o*e"er, responent is not a common carrier &$t a tra"el a%ency. It is
t!$s not &o$n $ner t!e la* to o&ser"e eCtraorinary ili%ence in t!e per#ormance o# its o&li%ation, as petitioner claims.
Since t!e contract &et*een t!e parties is an orinary one #or ser"ices, t!e stanar o# care re;$ire o# responent is t!at o# a
%oo #at!er o# a #amily $ner .rticle 1113 o# t!e Ci"il Coe.
F14G
T!is connotes reasona&le care consistent *it! t!at *!ic! an orinarily
pr$ent person *o$l !a"e o&ser"e *!en con#ronte *it! a similar sit$ation. T!e test to etermine *!et!er ne%li%ence attene t!e
per#ormance o# an o&li%ation isH i t!e e#enant in oin% t!e alle%e ne%li%ent act $se t!at reasona&le care an ca$tion *!ic! an
orinarily pr$ent person *o$l !a"e $se in t!e same sit$ationL I# not, t!en !e is %$ilty o# ne%li%ence.
F13G
In t!e case at &ar, t!e lo*er co$rt #o$n Menor ne%li%ent *!en s!e alle%ely in#orme petitioner o# t!e *ron% ay o# epart$re.
0etitioner8s testimony *as accepte as in$&ita&le e"ience o# Menor8s alle%e ne%li%ent act since responent i not call Menor to t!e
*itness stan to re#$te t!e alle%ation. T!e lo*er co$rt applie t!e pres$mption $ner R$le 131, Section 3 <e=
F12G
o# t!e R$les o# Co$rt
t!at e"ience *ill#$lly s$ppresse *o$l &e a"erse i# pro$ce an t!$s consiere petitioner8s $ncontraicte testimony to &e
s$##icient proo# o# !er claim.
On t!e ot!er !an, responent !as consistently enie t!at Menor *as ne%li%ent an maintains t!at petitioner8s assertion is
&elie &y t!e e"ience on recor. T!e ate an time o# epart$re *as le%i&ly *ritten on t!e plane tic'et an t!e tra"el papers *ere
eli"ere t*o ays in a"ance precisely so t!at petitioner co$l prepare #or t!e trip. It per#orme all its o&li%ations to ena&le petitioner to
?oin t!e to$r an eCercise $e ili%ence in its ealin%s *it! t!e latter.
:e a%ree *it! responent.
Responent8s #ail$re to present Menor as *itness to re&$t petitioner8s testimony co$l not %i"e rise to an in#erence $n#a"ora&le to
t!e #ormer. Menor *as alreay *or'in% in France at t!e time o# t!e #ilin% o# t!e complaint,
F16G
t!ere&y ma'in% it p!ysically impossi&le #or
responent to present !er as a *itness. T!en too, e"en i# it *ere possi&le #or responent to sec$re Menor8s testimony, t!e pres$mption
$ner R$le 131, Section 3<e= *o$l still not apply. T!e opport$nity an possi&ility #or o&tainin% Menor8s testimony &elon%e to &ot!
parties, consierin% t!at Menor *as not ?$st responent8s employee, &$t also petitioner8s niece. It *as t!$s error #or t!e lo*er co$rt to
in"o'e t!e pres$mption t!at responent *ill#$lly s$ppresse e"ience $ner R$le 131, Section 3<e=. Sai pres$mption *o$l lo%ically
&e inoperati"e i# t!e e"ience is not intentionally omitte &$t is simply $na"aila&le, or *!en t!e same co$l !a"e &een o&taine &y &ot!
parties.
F1DG
In s$m, *e o not a%ree *it! t!e #inin% o# t!e lo*er co$rt t!at Menor8s ne%li%ence conc$rre *it! t!e ne%li%ence o# petitioner an
res$ltantly ca$se ama%e to t!e latter. Menor8s ne%li%ence *as not s$##iciently pro"e, consierin% t!at t!e only e"ience presente
on t!is score *as petitioner8s $ncorro&orate narration o# t!e e"ents. It is *ellEsettle t!at t!e party alle%in% a #act !as t!e &$ren o#
pro"in% it an a mere alle%ation cannot ta'e t!e place o# e"ience.
F11G
I# t!e plainti##, $pon *!om rests t!e &$ren o# pro"in% !is ca$se o#
action, #ails to s!o* in a satis#actory manner #acts $pon *!ic! !e &ases !is claim, t!e e#enant is $ner no o&li%ation to pro"e !is
eCception or e#ense.
F1BG
Contrary to petitioner8s claim, t!e e"ience on recor s!o*s t!at responent eCercise $e ili%ence in per#ormin% its o&li%ations
$ner t!e contract an #ollo*e stanar proce$re in renerin% its ser"ices to petitioner. .s correctly o&ser"e &y t!e lo*er co$rt, t!e
plane tic'et
F19G
iss$e to petitioner clearly re#lecte t!e epart$re ate an time, contrary to petitioner8s contention. T!e tra"el
oc$ments, consistin% o# t!e to$r itinerary, "o$c!ers an instr$ctions, *ere li'e*ise eli"ere to petitioner t*o ays prior to t!e trip.
Responent also properly &oo'e petitioner #or t!e to$r, prepare t!e necessary oc$ments an proc$re t!e plane tic'ets. It arran%e
petitioner8s !otel accommoation as *ell as #oo, lan trans#ers an si%!tseein% eCc$rsions, in accorance *it! its a"o*e
$nerta'in%.
T!ere#ore, it is clear t!at responent per#orme its prestation $ner t!e contract as *ell as e"eryt!in% else t!at *as essential to
&oo' petitioner #or t!e to$r. ,a petitioner eCercise $e ili%ence in t!e con$ct o# !er a##airs, t!ere *o$l !a"e &een no reason #or
!er to miss t!e #li%!t. Neeless to say, a#ter t!e tra"el papers *ere eli"ere to petitioner, it &ecame inc$m&ent $pon !er to ta'e
orinary care o# !er concerns. T!is $no$&tely *o$l re;$ire t!at s!e at least rea t!e oc$ments in orer to ass$re !ersel# o# t!e
important etails re%arin% t!e trip.
T!e ne%li%ence o# t!e o&li%or in t!e per#ormance o# t!e o&li%ation reners !im lia&le #or ama%es #or t!e res$ltin% loss s$##ere &y
t!e o&li%ee. Fa$lt or ne%li%ence o# t!e o&li%or consists in !is #ail$re to eCercise $e care an pr$ence in t!e per#ormance o# t!e
o&li%ation as t!e nat$re o# t!e o&li%ation so emans.
F45G
T!ere is no #iCe stanar o# ili%ence applica&le to eac! an e"ery
contract$al o&li%ation an eac! case m$st &e etermine $pon its partic$lar #acts. T!e e%ree o# ili%ence re;$ire epens on t!e
circ$mstances o# t!e speci#ic o&li%ation an *!et!er one !as &een ne%li%ent is a ;$estion o# #act t!at is to &e etermine a#ter ta'in%
into acco$nt t!e partic$lars o# eac! case.
F41G
T!e lo*er co$rt eclare t!at responent8s employee *as ne%li%ent. T!is #act$al #inin%, !o*e"er, is not s$pporte &y t!e
e"ience on recor. :!ile #act$al #inin%s &elo* are %enerally concl$si"e $pon t!is co$rt, t!e r$le is s$&?ect to certain eCceptions, as
*!en t!e trial co$rt o"erloo'e, mis$nerstoo, or misapplie some #acts or circ$mstances o# *ei%!t an s$&stance *!ic! *ill a##ect
t!e res$lt o# t!e case.
F44G
In t!e case at &ar, t!e e"ience on recor s!o*s t!at responent company per#orme its $ty ili%ently an i not commit any
contract$al &reac!. ,ence, petitioner cannot reco"er an m$st &ear !er o*n ama%e.
3HERE!ORE, t!e instant petition is DENIED #or lac' o# merit. T!e ecision o# t!e Co$rt o# .ppeals in C.E-.R. CV No. 61934 is
.FFIRMED. .ccorin%ly, petitioner is orere to pay responent t!e amo$nt o# 014,951.55 representin% t!e &alance o# t!e price o# t!e
>ritis! 0a%eant 0ac'a%e To$r, *it! le%al interest t!ereon at t!e rate o# D7 per ann$m, to &e comp$te #rom t!e time t!e co$nterclaim
*as #ile $ntil t!e #inality o# t!is Decision. .#ter t!is Decision &ecomes #inal an eCec$tory, t!e rate o# 147 per ann$m s!all &e impose
$ntil t!e o&li%ation is #$lly settle, t!is interim perio &ein% eeme to &e &y t!en an e;$i"alent to a #or&earance o# creit.
F43G
SO OR(ERE(.
Davide, Jr., C.J., (Chairman), Vitug, Carpio, an Azcuna, JJ., conc$r.
G.R. No. 184312 5u$6 27, 2010
S"OSES (ANTE CR8 #$% LEONORA CR8, 0etitioners,
"s.
SN HOLI(A)S, INC., Responent.
D E C I S I O N
CAR"IO MORALES, J.:
Spo$ses Dante an Leonora Cr$/ <petitioners= lo%e a Complaint on )an$ary 46, 4551
1
a%ainst S$n ,oliays, Inc. <responent= *it!
t!e Re%ional Trial Co$rt <RTC= o# 0asi% City #or ama%es arisin% #rom t!e eat! o# t!eir son R$elito C. Cr$/ <R$elito= *!o peris!e *it!
!is *i#e on Septem&er 11, 4555 on &oar t!e &oat MI> Coco >eac! III t!at capsi/e en ro$te to >atan%as #rom 0$erto -alera, Oriental
Minoro *!ere t!e co$ple !a staye at Coco >eac! Islan Resort <Resort= o*ne an operate &y responent.
T!e stay o# t!e ne*ly *e R$elito an !is *i#e at t!e Resort #rom Septem&er 9 to 11, 4555 *as &y "irt$e o# a to$r pac'a%eEcontract
*it! responent t!at incl$e transportation to an #rom t!e Resort an t!e point o# epart$re in >atan%as.
Mi%$el C. Mat$te <Mat$te=,
4
a sc$&a i"in% instr$ctor an one o# t!e s$r"i"ors, %a"e !is acco$nt o# t!e incient t!at le to t!e #ilin% o#
t!e complaint as #ollo*sH
Mat$te staye at t!e Resort #rom Septem&er B to 11, 4555. ,e *as ori%inally sc!e$le to lea"e t!e Resort in t!e a#ternoon o#
Septem&er 15, 4555, &$t *as a"ise to stay #or anot!er ni%!t &eca$se o# stron% *ins an !ea"y rains.
On Septem&er 11, 4555, as it *as still *iny, Mat$te an 46 ot!er Resort %$ests incl$in% petitioners8 son an !is *i#e tre''e to t!e
ot!er sie o# t!e Coco >eac! mo$ntain t!at *as s!eltere #rom t!e *in *!ere t!ey &oare MI> Coco >eac! III, *!ic! *as to #erry
t!em to >atan%as.
S!ortly a#ter t!e &oat saile, it starte to rain. .s it mo"e #art!er a*ay #rom 0$erto -alera an into t!e open seas, t!e rain an *in
%ot stron%er, ca$sin% t!e &oat to tilt #rom sie to sie an t!e captain to step #or*ar to t!e #ront, lea"in% t!e *!eel to one o# t!e cre*
mem&ers.
T!e *a"es %ot more $n*iely. .#ter %ettin% !it &y t*o &i% *a"es *!ic! came one a#ter t!e ot!er, MI> Coco >eac! III capsi/e p$ttin%
all passen%ers $ner*ater.
T!e passen%ers, *!o !a p$t on t!eir li#e ?ac'ets, str$%%le to %et o$t o# t!e &oat. @pon seein% t!e captain, Mat$te an t!e ot!er
passen%ers *!o reac!e t!e s$r#ace as'e !im *!at t!ey co$l o to sa"e t!e people *!o *ere still trappe $ner t!e &oat. T!e
captain replie MIli%tas niyo na lan% an% sarili niyoM <)$st sa"e yo$rsel"es=.
,elp came a#ter a&o$t 26 min$tes *!en t*o &oats o*ne &y .sia Di"ers in Sa&an%, 0$erto -alera passe &y t!e capsi/e MI> Coco
>eac! III. >oare on t!ose t*o &oats *ere 44 persons, consistin% o# 1B passen%ers an #o$r cre* mem&ers, *!o *ere &ro$%!t to
0isa Islan. Ei%!t passen%ers, incl$in% petitioners8 son an !is *i#e, ie $rin% t!e incient.
.t t!e time o# R$elito8s eat!, !e *as 4B years ol an employe as a contract$al *or'er #or Mits$i En%ineerin% N S!ip&$ilin% .ra&ia,
Lt. in Sa$i .ra&ia, *it! a &asic mont!ly salary o# A955.
3
0etitioners, &y letter o# Octo&er 4D, 4555,
2
emane inemni#ication #rom responent #or t!e eat! o# t!eir son in t!e amo$nt o# at
least 02,555,555.
Replyin%, responent, &y letter ate No"em&er 1, 4555,
6
enie any responsi&ility #or t!e incient *!ic! it consiere to &e a
#ort$ito$s e"ent. It ne"ert!eless o##ere, as an act o# commiseration, t!e amo$nt o# 015,555 to petitioners $pon t!eir si%nin% o# a *ai"er.
.s petitioners ecline responent8s o##er, t!ey #ile t!e Complaint, as earlier re#lecte, alle%in% t!at responent, as a common carrier,
*as %$ilty o# ne%li%ence in allo*in% MI> Coco >eac! III to sail not*it!stanin% storm *arnin% &$lletins iss$e &y t!e 0!ilippine
.tmosp!eric, -eop!ysical an .stronomical Ser"ices .ministration <0.-.S.= as early as 6H55 a.m. o# Septem&er 11, 4555.
D
In its .ns*er,
1
responent enie &ein% a common carrier, alle%in% t!at its &oats are not a"aila&le to t!e %eneral p$&lic as t!ey only
#erry Resort %$ests an cre* mem&ers. Nonet!eless, it claime t!at it eCercise t!e $tmost ili%ence in ens$rin% t!e sa#ety o# its
passen%ersJ contrary to petitioners8 alle%ation, t!ere *as no storm on Septem&er 11, 4555 as t!e Coast -$ar in #act cleare t!e
"oya%eJ an MI> Coco >eac! III *as not #ille to capacity an !a s$##icient li#e ?ac'ets #or its passen%ers. >y *ay o# Co$nterclaim,
responent alle%e t!at it is entitle to an a*ar #or attorney8s #ees an liti%ation eCpenses amo$ntin% to not less t!an 0355,555.
Carlos >on;$in, captain o# MI> Coco >eac! III, a"erre t!at t!e Resort c$stomarily re;$ires #o$r conitions to &e met &e#ore a &oat is
allo*e to sail, to *itH <1= t!e sea is calm, <4= t!ere is clearance #rom t!e Coast -$ar, <3= t!ere is clearance #rom t!e captain an <2=
t!ere is clearance #rom t!e Resort8s assistant mana%er.
B
,e ae t!at MI> Coco >eac! III met all #o$r conitions on Septem&er 11,
4555,
9
&$t a s$&asco or s;$all, c!aracteri/e &y stron% *ins an &i% *a"es, s$enly occ$rre, ca$sin% t!e &oat to capsi/e.
15
>y Decision o# Fe&r$ary 1D, 4556,
11
>ranc! 4D1 o# t!e 0asi% RTC ismisse petitioners8 Complaint an responent8s Co$nterclaim.
0etitioners8 Motion #or Reconsieration !a"in% &een enie &y Orer ate Septem&er 4, 4556,
14
t!ey appeale to t!e Co$rt o#
.ppeals.
>y Decision o# .$%$st 19, 455B,
13
t!e appellate co$rt enie petitioners8 appeal, !olin%, amon% ot!er t!in%s, t!at t!e trial co$rt
correctly r$le t!at responent is a pri"ate carrier *!ic! is only re;$ire to o&ser"e orinary ili%enceJ t!at responent in #act o&ser"e
eCtraorinary ili%ence in transportin% its %$ests on &oar MI> Coco >eac! IIIJ an t!at t!e proCimate ca$se o# t!e incient *as a
s;$all, a #ort$ito$s e"ent.
0etitioners8 Motion #or Reconsieration !a"in% &een enie &y Resol$tion ate )an$ary 1D, 4559,
12
t!ey #ile t!e present 0etition #or
Re"ie*.
16
0etitioners maintain t!e position t!ey too' &e#ore t!e trial co$rt, ain% t!at responent is a common carrier since &y its to$r pac'a%e,
t!e transportin% o# its %$ests is an inte%ral part o# its resort &$siness. T!ey in#orm t!at anot!er i"ision o# t!e appellate co$rt in #act !el
responent lia&le #or ama%es to t!e ot!er s$r"i"ors o# t!e incient.
@pon t!e ot!er !an, responent contens t!at petitioners #aile to present e"ience to pro"e t!at it is a common carrierJ t!at t!e
Resort8s #erry ser"ices #or %$ests cannot &e consiere as ancillary to its &$siness as no income is eri"e t!ere#romJ t!at it eCercise
eCtraorinary ili%ence as s!o*n &y t!e conitions it !a impose &e#ore allo*in% MI> Coco >eac! III to sailJ t!at t!e incient *as
ca$se &y a #ort$ito$s e"ent *it!o$t any contri&$tory ne%li%ence on its partJ an t!at t!e ot!er case *!erein t!e appellate co$rt !el it
lia&le #or ama%es in"ol"e i##erent plainti##s, iss$es an e"ience.
1D
T!e petition is impresse *it! merit.
0etitioners correctly rely on De -$/man ". Co$rt o# .ppeals
11
in c!aracteri/in% responent as a common carrier.
T!e Ci"il Coe e#ines Mcommon carriersM in t!e #ollo*in% termsH
.rticle 1134. Common carriers are persons, corporations, #irms or associations en%a%e in t!e &$siness o# carryin% or transportin%
passen%ers or %oos or &ot!, &y lan, *ater, or air #or compensation, o##erin% t!eir ser"ices to t!e p$&lic.
T!e a&o"e article ma'es no istinction &et*een one *!ose principal &$siness acti"ity is t!e carryin% o# persons or %oos or &ot!, an
one *!o oes s$c! carryin% only as an ancillary acti"ity <in local iiom, as Ma sielineM=. .rticle 1134 also care#$lly a"ois ma'in% any
istinction &et*een a person or enterprise o##erin% transportation ser"ice on a re%$lar or sc!e$le &asis an one o##erin% s$c! ser"ice
on an occasional, episoic or $nsc!e$le &asis. Neit!er oes .rticle 1134 istin%$is! &et*een a carrier o##erin% its ser"ices to
t!e M%eneral p$&lic,M i.e., t!e %eneral comm$nity or pop$lation, an one *!o o##ers ser"ices or solicits &$siness only #rom a narro*
se%ment o# t!e %eneral pop$lation. :e t!in' t!at .rticle 1133 eli&erately re#raine #rom ma'in% s$c! istinctions.
So $nerstoo, t!e concept o# Mcommon carrierM $ner .rticle 1134 may &e seen to coincie neatly *it! t!e notion o# Mp$&lic ser"ice,M
$ner t!e 0$&lic Ser"ice .ct <Common*ealt! .ct No. 121D, as amene= *!ic! at least partially s$pplements t!e la* on common
carriers set #ort! in t!e Ci"il Coe. @ner Section 13, para%rap! <&= o# t!e 0$&lic Ser"ice .ct, Mp$&lic ser"iceM incl$esH
. . . e"ery person t!at no* or !erea#ter may o*n, operate, mana%e, or control in t!e 0!ilippines, #or !ire or compensation, *it! %eneral
or limite clientele, *!et!er permanent, occasional or acciental, an one #or %eneral &$siness p$rposes, any common carrier,
railroa, street rail*ay, traction rail*ay, s$&*ay motor "e!icle, eit!er #or #rei%!t or passen%er, or &ot!, *it! or *it!o$t #iCe ro$te an
*!ate"er may &e its classi#ication, #rei%!t or carrier ser"ice o# any class, eCpress ser"ice, steam&oat, or steams!ip line, pontines, #erries
an *ater cra#t, en%a%e in t!e transportation o# passen%ers or #rei%!t or &ot!, s!ipyar, marine repair s!op, *!ar# or oc', ice plant,
iceEre#ri%eration plant, canal, irri%ation system, %as, electric li%!t, !eat an po*er, *ater s$pply an po*er petrole$m, se*era%e
system, *ire or *ireless comm$nications systems, *ire or *ireless &roacastin% stations an ot!er similar p$&lic ser"ices . . .
1B
<emp!asis an $nerscorin% s$pplie.=
Inee, responent is a common carrier. Its #erry ser"ices are so intert*ine *it! its main &$siness as to &e properly consiere
ancillary t!ereto. T!e constancy o# responent8s #erry ser"ices in its resort operations is $nerscore &y its !a"in% its o*n Coco >eac!
&oats. .n t!e to$r pac'a%es it o##ers, *!ic! incl$e t!e #erry ser"ices, may &e a"aile o# &y anyone *!o can a##or to pay t!e same.
T!ese ser"ices are t!$s a"aila&le to t!e p$&lic.
T!at responent oes not c!ar%e a separate #ee or #are #or its #erry ser"ices is o# no moment. It *o$l &e impr$ent to s$ppose t!at it
pro"ies sai ser"ices at a loss. T!e Co$rt is a*are o# t!e practice o# &eac! resort operators o##erin% to$r pac'a%es to #actor t!e
transportation #ee in arri"in% at t!e to$r pac'a%e price. T!at %$ests *!o opt not to a"ail o# responent8s #erry ser"ices pay t!e same
amo$nt is li'e*ise inconse;$ential. T!ese %$ests may only &e eeme to !a"e o"erpai.
.s De -$/man instr$cts, .rticle 1134 o# t!e Ci"il Coe e#inin% Mcommon carriersM !as eli&erately re#raine #rom ma'in% istinctions
on *!et!er t!e carryin% o# persons or %oos is t!e carrier8s principal &$siness, *!et!er it is o##ere on a re%$lar &asis, or *!et!er it is
o##ere to t!e %eneral p$&lic. T!e intent o# t!e la* is t!$s to not consier s$c! istinctions. Ot!er*ise, t!ere is no tellin% !o* many
ot!er istinctions may &e concocte &y $nscr$p$lo$s &$sinessmen en%a%e in t!e carryin% o# persons or %oos in orer to a"oi t!e
le%al o&li%ations an lia&ilities o# common carriers.
@ner t!e Ci"il Coe, common carriers, #rom t!e nat$re o# t!eir &$siness an #or reasons o# p$&lic policy, are &o$n to o&ser"e
eCtraorinary ili%ence #or t!e sa#ety o# t!e passen%ers transporte &y t!em, accorin% to all t!e circ$mstances o# eac! case.
19
T!ey
are &o$n to carry t!e passen%ers sa#ely as #ar as !$man care an #oresi%!t can pro"ie, $sin% t!e $tmost ili%ence o# "ery ca$tio$s
persons, *it! $e re%ar #or all t!e circ$mstances.
45
:!en a passen%er ies or is in?$re in t!e isc!ar%e o# a contract o# carria%e, it is pres$me t!at t!e common carrier is at #a$lt or
ne%li%ent. In #act, t!ere is e"en no nee #or t!e co$rt to ma'e an eCpress #inin% o# #a$lt or ne%li%ence on t!e part o# t!e common
carrier. T!is stat$tory pres$mption may only &e o"ercome &y e"ience t!at t!e carrier eCercise eCtraorinary ili%ence.
41
Responent ne"ert!eless !arps on its strict compliance *it! t!e earlier mentione conitions o# "oya%e &e#ore it allo*e MI> Coco
>eac! III to sail on Septem&er 11, 4555. Responent8s position oes not impress.
T!e e"ience s!o*s t!at 0.-.S. iss$e 42E!o$r p$&lic *eat!er #orecasts an tropical cyclone *arnin%s #or s!ippin% on Septem&er
15 an 11, 4555 a"isin% o# tropical epressions in Nort!ern L$/on *!ic! *o$l also a##ect t!e pro"ince o# Minoro.
44
>y t!e testimony
o# Dr. Frisco Nilo, s$per"isin% *eat!er specialist o# 0.-.S., s;$alls are to &e eCpecte $ner s$c! *eat!er conition.
43
. "ery ca$tio$s person eCercisin% t!e $tmost ili%ence *o$l t!$s not &ra"e s$c! stormy *eat!er an p$t ot!er people8s li"es at ris'.
T!e eCtraorinary ili%ence re;$ire o# common carriers emans t!at t!ey ta'e care o# t!e %oos or li"es entr$ste to t!eir !ans as i#
t!ey *ere t!eir o*n. T!is responent #aile to o.
Responent8s insistence t!at t!e incient *as ca$se &y a #ort$ito$s e"ent oes not impress eit!er.
T!e elements o# a M#ort$ito$s e"entM areH <a= t!e ca$se o# t!e $n#oreseen an $neCpecte occ$rrence, or t!e #ail$re o# t!e e&tors to
comply *it! t!eir o&li%ations, m$st !a"e &een inepenent o# !$man *illJ <&= t!e e"ent t!at constit$te t!e caso #ort$ito m$st !a"e
&een impossi&le to #oresee or, i# #oreseea&le, impossi&le to a"oiJ <c= t!e occ$rrence m$st !a"e &een s$c! as to rener it impossi&le #or
t!e e&tors to #$l#ill t!eir o&li%ation in a normal mannerJ an <= t!e o&li%or m$st !a"e &een #ree #rom any participation in t!e
a%%ra"ation o# t!e res$ltin% in?$ry to t!e creitor.
42
To #$lly #ree a common carrier #rom any lia&ility, t!e #ort$ito$s e"ent m$st !a"e &een t!e proCimate an only ca$seo# t!e loss. .n it
s!o$l !a"e eCercise $e ili%ence to pre"ent or minimi/e t!e loss &e#ore, $rin% an a#ter t!e occ$rrence o# t!e #ort$ito$s e"ent.
46
Responent cites t!e s;$all t!at occ$rre $rin% t!e "oya%e as t!e #ort$ito$s e"ent t!at o"ert$rne MI> Coco >eac! III. .s re#lecte
a&o"e, !o*e"er, t!e occ$rrence o# s;$alls *as eCpecte $ner t!e *eat!er conition o# Septem&er 11, 4555. Moreo"er, e"ience
s!o*s t!at MI> Coco >eac! III s$##ere en%ine tro$&le &e#ore it capsi/e an san'.
4D
T!e incient *as, t!ere#ore, not completely #ree
#rom !$man inter"ention.
T!e Co$rt nee not &ela&or !o* responent8s e"ience li'e*ise #ails to emonstrate t!at it eCercise $e ili%ence to pre"ent or
minimi/e t!e loss &e#ore, $rin% an a#ter t!e occ$rrence o# t!e s;$all.
.rticle 11D2
41
"isEOE"is .rticle 445D
4B
o# t!e Ci"il Coe !ols t!e common carrier in &reac! o# its contract o# carria%e t!at res$lts in t!e
eat! o# a passen%er lia&le to pay t!e #ollo*in%H <1= inemnity #or eat!, <4= inemnity #or loss o# earnin% capacity an <3= moral
ama%es.
0etitioners are entitle to inemnity #or t!e eat! o# R$elito *!ic! is #iCe at 065,555.
49
.s #or ama%es representin% $nearne income, t!e #orm$la #or its comp$tation isH
Net Earnin% Capacity P li#e eCpectancy C <%ross ann$al income E reasona&le an necessary li"in% eCpenses=.
Li#e eCpectancy is etermine in accorance *it! t!e #orm$laH
4 I 3 C FB5 Q a%e o# ecease at t!e time o# eat!G
35
T!e #irst #actor, i.e., li#e eCpectancy, is comp$te &y applyin% t!e #orm$la <4I3 C FB5 Q a%e at eat!G= aopte in t!e .merican
ECpectancy Ta&le o# Mortality or t!e .ct$arial o# Com&ine ECperience Ta&le o# Mortality.
31
T!e secon #actor is comp$te &y m$ltiplyin% t!e li#e eCpectancy &y t!e net earnin%s o# t!e ecease, i.e., t!e total earnin%s less
eCpenses necessary in t!e creation o# s$c! earnin%s or income an less li"in% an ot!er inciental eCpenses.
34
T!e loss is not
e;$i"alent to t!e entire earnin%s o# t!e ecease, &$t only s$c! portion as !e *o$l !a"e $se to s$pport !is epenents or !eirs.
,ence, to &e e$cte #rom !is %ross earnin%s are t!e necessary eCpenses s$ppose to &e $se &y t!e ecease #or !is o*n nees.
33
In comp$tin% t!e t!ir #actor 9 necessary li"in% eCpense, Smit! >ell Do*ell S!ippin% .%ency Corp. ". >or?a
32
teac!es t!at *!en, as in
t!is case, t!ere is no s!o*in% t!at t!e li"in% eCpenses constit$te t!e smaller percenta%e o# t!e %ross income, t!e li"in% eCpenses are
#iCe at !al# o# t!e %ross income.
.pplyin% t!e a&o"e %$ielines, t!e Co$rt etermines R$elitoRs li#e eCpectancy as #ollo*sH
Li#e eCpectancy P 4I3 C FB5 E a%e o# ecease at t!e time o# eat!G
4I3 C FB5 E 4BG
4I3 C F64G
Li#e eCpectancy P 36
Doc$mentary e"ience s!o*s t!at R$elito *as earnin% a &asic mont!ly salary o# A955
36
*!ic!, *!en con"erte to 0!ilippine peso
applyin% t!e ann$al a"era%e eCc!an%e rate o# A1 P 022 in 4555,
3D
amo$nts to 039,D55. R$elito8s net earnin% capacity is t!$s comp$te
as #ollo*sH
Net Earnin% Capacity P li#e eCpectancy C <%ross ann$al income E reasona&le an necessary li"in% eCpenses=.
P 36 C <0216,455 E 0431,D55=
P 36 C <0431,D55=
Net Earnin% Capacity P 0B,31D,555
Respectin% t!e a*ar o# moral ama%es, since responent common carrier8s &reac! o# contract o# carria%e res$lte in t!e eat! o#
petitioners8 son, #ollo*in% .rticle 11D2 "isEOE"is .rticle 445D o# t!e Ci"il Coe, petitioners are entitle to moral ama%es.
Since responent #aile to pro"e t!at it eCercise t!e eCtraorinary ili%ence re;$ire o# common carriers, it is pres$me to !a"e acte
rec'lessly, t!$s *arrantin% t!e a*ar too o# eCemplary ama%es, *!ic! are %rante in contract$al o&li%ations i# t!e e#enant acte in
a *anton, #ra$$lent, rec'less, oppressi"e or male"olent manner.
31
@ner t!e circ$mstances, it is reasona&le to a*ar petitioners t!e amo$nt o# 0155,555 as moral ama%es an0155,555 as eCemplary
ama%es.
3B
1avvphi1
0$rs$ant to .rticle 445B
39
o# t!e Ci"il Coe, attorneyRs #ees may also &e a*are *!ere eCemplary ama%es are a*are. T!e Co$rt
#ins t!at 157 o# t!e total amo$nt a?$%e a%ainst responent is reasona&le #or t!e p$rpose.
Finally, Eastern S!ippin% Lines, Inc. ". Co$rt o# .ppeals
25
teac!es t!at *!en an o&li%ation, re%arless o# its so$rce, i.e., la*, contracts,
;$asiEcontracts, elicts or ;$asiEelicts is &reac!e, t!e contra"enor can &e !el lia&le #or payment o# interest in t!e concept o# act$al
an compensatory ama%es, s$&?ect to t!e #ollo*in% r$les, to *it Q
1. :!en t!e o&li%ation is &reac!e, an it consists in t!e payment o# a s$m o# money, i.e., a loan or #or&earance o# money, t!e
interest $e s!o$l &e t!at *!ic! may !a"e &een stip$late in *ritin%. F$rt!ermore, t!e interest $e s!all itsel# earn le%al
interest #rom t!e time it is ?$icially emane. In t!e a&sence o# stip$lation, t!e rate o# interest s!all &e 147 per ann$m to &e
comp$te #rom e#a$lt, i.e., #rom ?$icial or eCtra?$icial eman $ner an s$&?ect to t!e pro"isions o# .rticle 11D9 o# t!e Ci"il
Coe.
4. :!en an o&li%ation, not constit$tin% a loan or #or&earance o# money, is &reac!e, an interest on t!e amo$nt o# ama%es
a*are may &e impose at t!e iscretion o# t!e co$rt at t!e rate o# D7 per ann$m. No interest, !o*e"er, s!all &e a?$%e
on $nli;$iate claims or ama%es eCcept *!en or $ntil t!e eman can &e esta&lis!e *it! reasona&le certainty. .ccorin%ly,
*!ere t!e eman is esta&lis!e *it! reasona&le certainty, t!e interest s!all &e%in to r$n #rom t!e time t!e claim is mae
?$icially or eCtra?$icially <.rt. 11D9, Ci"il Coe= &$t *!en s$c! certainty cannot &e so reasona&ly esta&lis!e at t!e time t!e
eman is mae, t!e interest s!all &e%in to r$n only #rom t!e ate t!e ?$%ment o# t!e co$rt is mae <at *!ic! time t!e
;$anti#ication o# ama%es may &e eeme to !a"e &een reasona&ly ascertaine=. T!e act$al &ase #or t!e comp$tation o# le%al
interest s!all, in any case, &e on t!e amo$nt #inally a?$%e.
3. :!en t!e ?$%ment o# t!e co$rt a*arin% a s$m o# money &ecomes #inal an eCec$tory, t!e rate o# le%al interest, *!et!er
t!e case #alls $ner para%rap! 1 or para%rap! 4, a&o"e, s!all &e 147 per ann$m #rom s$c! #inality $ntil its satis#action, t!is
interim perio &ein% eeme to &e &y t!en an e;$i"alent to a #or&earance o# creit. <emp!asis s$pplie=.
Since t!e amo$nts paya&le &y responent !a"e &een etermine *it! certainty only in t!e present petition, t!e interest $e s!all &e
comp$te $pon t!e #inality o# t!is ecision at t!e rate o# 147 per ann$m $ntil satis#action, in accorance *it! para%rap! n$m&er 3 o#
t!e immeiately cite %$ieline in Easter S!ippin% Lines, Inc.
:,EREFORE, t!e Co$rt o# .ppeals Decision o# .$%$st 19, 455B is REVERSED an SET .SIDE. )$%ment is renere in #a"or o#
petitioners orerin% responent to pay petitioners t!e #ollo*in%H <1= 065,555 as inemnity #or t!e eat! o# R$elito Cr$/J <4= 0B,31D,555
as inemnity #or R$elito8s loss o# earnin% capacityJ <3= 0155,555 as moral ama%esJ <2= 0155,555 as eCemplary ama%esJ <6= 157 o#
t!e total amo$nt a?$%e a%ainst responent as attorneys #eesJ an <D= t!e costs o# s$it.
T!e total amo$nt a?$%e a%ainst responent s!all earn interest at t!e rate o# 147 per ann$m comp$te #rom t!e #inality o# t!is
ecision $ntil #$ll payment.
SO ORDERED.
CONCHITA CAR"IO MORALES
.ssociate )$stice
C!airperson
G.R. No. L*49822 (606:;6, 22, 1788
"E(RO (E G8MAN, petitioner,
"s.
CORT O! A""EALS #$% ERNESTO CEN(ANA, responents.
Vicente D. Millora for petitioner.
Jacinto Callanta for private respondent.

!ELICIANO, J.:
Responent Ernesto Cenana, a ?$n' ealer, *as en%a%e in &$yin% $p $se &ottles an scrap metal in 0an%asinan. @pon %at!erin%
s$##icient ;$antities o# s$c! scrap material, responent *o$l &rin% s$c! material to Manila #or resale. ,e $tili/e t*o <4= siCE*!eeler
tr$c's *!ic! !e o*ne #or !a$lin% t!e material to Manila. On t!e ret$rn trip to 0an%asinan, responent *o$l loa !is "e!icles *it!
car%o *!ic! "ario$s merc!ants *ante eli"ere to i##erin% esta&lis!ments in 0an%asinan. For t!at ser"ice, responent c!ar%e
#rei%!t rates *!ic! *ere commonly lo*er t!an re%$lar commercial rates.
Sometime in No"em&er 1915, petitioner 0ero e -$/man a merc!ant an a$t!ori/e ealer o# -eneral Mil' Company <0!ilippines=,
Inc. in @raneta, 0an%asinan, contracte *it! responent #or t!e !a$lin% o# 165 cartons o# Li&erty #ille mil' #rom a *are!o$se o#
-eneral Mil' in Ma'ati, Ri/al, to petitionerRs esta&lis!ment in @raneta on or &e#ore 2 Decem&er 1915. .ccorin%ly, on 1 Decem&er
1915, responent loae in Ma'ati t!e merc!anise on to !is tr$c'sH 165 cartons *ere loae on a tr$c' ri"en &y responent !imsel#,
*!ile D55 cartons *ere place on &oar t!e ot!er tr$c' *!ic! *as ri"en &y Man$el Estraa, responentRs ri"er an employee.
Only 165 &oCes o# Li&erty #ille mil' *ere eli"ere to petitioner. T!e ot!er D55 &oCes ne"er reac!e petitioner, since t!e tr$c' *!ic!
carrie t!ese &oCes *as !i?ac'e some*!ere alon% t!e Mac.rt!$r ,i%!*ay in 0ani;$i, Tarlac, &y arme men *!o too' *it! t!em t!e
tr$c', its ri"er, !is !elper an t!e car%o.
On D )an$ary 1911, petitioner commence action a%ainst pri"ate responent in t!e Co$rt o# First Instance o# 0an%asinan, emanin%
payment o# 0 44,165.55, t!e claime "al$e o# t!e lost merc!anise, pl$s ama%es an attorneyRs #ees. 0etitioner ar%$e t!at pri"ate
responent, &ein% a common carrier, an !a"in% #aile to eCercise t!e eCtraorinary ili%ence re;$ire o# !im &y t!e la*, s!o$l &e
!el lia&le #or t!e "al$e o# t!e $neli"ere %oos.
In !is .ns*er, pri"ate responent enie t!at !e *as a common carrier an ar%$e t!at !e co$l not &e !el responsi&le #or t!e "al$e
o# t!e lost %oos, s$c! loss !a"in% &een $e to force maeure.
On 15 Decem&er 1916, t!e trial co$rt renere a Decision
1
#inin% pri"ate responent to &e a common carrier an !olin% !im lia&le
#or t!e "al$e o# t!e $neli"ere %oos <0 44,165.55= as *ell as #or 0 2,555.55 as ama%es an 0 4,555.55 as attorneyRs #ees.
On appeal &e#ore t!e Co$rt o# .ppeals, responent $r%e t!at t!e trial co$rt !a erre in consierin% !im a common carrierJ in #inin%
t!at !e !a !a&it$ally o##ere tr$c'in% ser"ices to t!e p$&licJ in not eCemptin% !im #rom lia&ility on t!e %ro$n o# force maeure! an in
orerin% !im to pay ama%es an attorneyRs #ees.
T!e Co$rt o# .ppeals re"erse t!e ?$%ment o# t!e trial co$rt an !el t!at responent !a &een en%a%e in transportin% ret$rn loas
o# #rei%!t Mas a cas$al
occ$pation Q a sieline to !is scrap iron &$sinessM an not as a common carrier. 0etitioner came to t!is Co$rt &y *ay o# a 0etition #or
Re"ie* assi%nin% as errors t!e #ollo*in% concl$sions o# t!e Co$rt o# .ppealsH
1. t!at pri"ate responent *as not a common carrierJ
4. t!at t!e !i?ac'in% o# responentRs tr$c' *as force maeureJ an
3. t!at responent *as not lia&le #or t!e "al$e o# t!e $neli"ere car%o. <Rollo, p. 111=
:e consier #irst t!e iss$e o# *!et!er or not pri"ate responent Ernesto Cenana may, $ner t!e #acts earlier set #ort!, &e properly
c!aracteri/e as a common carrier.
T!e Ci"il Coe e#ines Mcommon carriersM in t!e #ollo*in% termsH
.rticle 1134. Common carriers are persons, corporations, #irms or associations en%a%e in t!e &$siness o# carryin%
or transportin% passen%ers or %oos or &ot!, &y lan, *ater, or air #or compensation, o##erin% t!eir ser"ices to t!e
p$&lic.
T!e a&o"e article ma'es no istinction &et*een one *!ose principal &$siness acti"ity is t!e carryin% o# persons or %oos or &ot!, an
one *!o oes s$c! carryin% only as an ancillar" acti"ity <in local Iiom as Ma sielineM=. .rticle 1134 also care#$lly a"ois ma'in% any
istinction &et*een a person or enterprise o##erin% transportation ser"ice on a regular or scheduled #asis an one o##erin% s$c! ser"ice
on an occasional, episodic or unscheduled #asis. Neit!er oes .rticle 1134 istin%$is! &et*een a carrier o##erin% its ser"ices to t!e
Mgeneral pu#lic,M i.e., t!e %eneral comm$nity or pop$lation, an one *!o o##ers ser"ices or solicits &$siness only #rom a narro* se%ment
o# t!e %eneral pop$lation. :e t!in' t!at .rticle 1133 eli&eraom ma'in% s$c! istinctions.
So $nerstoo, t!e concept o# Mcommon carrierM $ner .rticle 1134 may &e seen to coincie neatly *it! t!e notion o# Mp$&lic ser"ice,M
$ner t!e 0$&lic Ser"ice .ct <Common*ealt! .ct No. 121D, as amene= *!ic! at least partially s$pplements t!e la* on common
carriers set #ort! in t!e Ci"il Coe. @ner Section 13, para%rap! <&= o# t!e 0$&lic Ser"ice .ct, Mp$&lic ser"iceM incl$esH
... e"ery person t!at no* or !erea#ter may o*n, operate, mana%e, or control in t!e 0!ilippines, #or !ire or
compensation, $ith general or limited clientele, $hether permanent, occasional or accidental, and done for general
#usiness purposes, an" common carrier, railroa, street rail*ay, traction rail*ay, s$&*ay motor "e!icle, eit!er #or
#rei%!t or passen%er, or &ot!, *it! or *it!o$t #iCe ro$te an *!ate"er may &e its classi#ication, #rei%!t or carrier
ser"ice o# any class, eCpress ser"ice, steam&oat, or steams!ip line, pontines, #erries an *ater cra#t, en%a%e in t!e
transportation o# passen%ers or #rei%!t or &ot!, s!ipyar, marine repair s!op, *!ar# or oc', ice plant,
iceEre#ri%eration plant, canal, irri%ation system, %as, electric li%!t, !eat an po*er, *ater s$pply an po*er petrole$m,
se*era%e system, *ire or *ireless comm$nications systems, *ire or *ireless &roacastin% stations an ot!er similar
p$&lic ser"ices. ... <Emp!asis s$pplie=
It appears to t!e Co$rt t!at pri"ate responent is properly c!aracteri/e as a common carrier e"en t!o$%! !e merely M&ac'E!a$leM
%oos #or ot!er merc!ants #rom Manila to 0an%asinan, alt!o$%! s$c! &ac'E!a$lin% *as one on a perioic or occasional rat!er t!an
re%$lar or sc!e$le manner, an e"en t!o$%! pri"ate responentRsprincipal occ$pation *as not t!e carria%e o# %oos #or ot!ers. T!ere
is no isp$te t!at pri"ate responent c!ar%e !is c$stomers a #ee #or !a$lin% t!eir %oosJ t!at #ee #re;$ently #ell &elo* commercial
#rei%!t rates is not rele"ant !ere.
T!e Co$rt o# .ppeals re#erre to t!e #act t!at pri"ate responent !el no certi#icate o# p$&lic con"enience, an concl$e !e *as not a
common carrier. T!is is palpa&le error. . certi#icate o# p$&lic con"enience is not a re;$isite #or t!e inc$rrin% o# lia&ility $ner t!e Ci"il
Coe pro"isions %o"ernin% common carriers. T!at lia&ility arises t!e moment a person or #irm acts as a common carrier, *it!o$t re%ar
to *!et!er or not s$c! carrier !as also complie *it! t!e re;$irements o# t!e applica&le re%$latory stat$te an implementin%
re%$lations an !as &een %rante a certi#icate o# p$&lic con"enience or ot!er #ranc!ise. To eCempt pri"ate responent #rom t!e lia&ilities
o# a common carrier &eca$se !e !as not sec$re t!e necessary certi#icate o# p$&lic con"enience, *o$l &e o##ensi"e to so$n p$&lic
policyJ t!at *o$l &e to re*ar pri"ate responent precisely #or #ailin% to comply *it! applica&le stat$tory re;$irements. T!e &$siness o#
a common carrier impin%es irectly an intimately $pon t!e sa#ety an *ell &ein% an property o# t!ose mem&ers o# t!e %eneral
comm$nity *!o !appen to eal *it! s$c! carrier. T!e la* imposes $ties an lia&ilities $pon common carriers #or t!e sa#ety an
protection o# t!ose *!o $tili/e t!eir ser"ices an t!e la* cannot allo* a common carrier to rener s$c! $ties an lia&ilities merely
#ac$ltati"e &y simply #ailin% to o&tain t!e necessary permits an a$t!ori/ations.
:e t$rn t!en to t!e lia&ility o# pri"ate responent as a common carrier.
Common carriers, M&y t!e nat$re o# t!eir &$siness an #or reasons o# p$&lic policyM
2
are !el to a "ery !i%! e%ree o# care an
ili%ence <MeCtraorinary ili%enceM= in t!e carria%e o# %oos as *ell as o# passen%ers. T!e speci#ic import o# eCtraorinary ili%ence in
t!e care o# %oos transporte &y a common carrier is, accorin% to .rticle 1133, M#$rt!er eCpresse in .rticles 1132,1136 an 1126,
n$m&ers 6, D an 1M o# t!e Ci"il Coe.
.rticle 1132 esta&lis!es t!e %eneral r$le t!at common carriers are responsi&le #or t!e loss, estr$ction or eterioration o# t!e %oos
*!ic! t!ey carry, Munless t!e same is $e to an" of the follo$ing causes onl"H
<1= Floo, storm, eart!;$a'e, li%!tnin% or ot!er nat$ral isaster or calamityJ
<4= .ct o# t!e p$&lic enemy in *ar, *!et!er international or ci"ilJ
<3= .ct or omission o# t!e s!ipper or o*ner o# t!e %oosJ
<2= T!e c!aracterEo# t!e %oos or e#ects in t!e pac'in% orEin t!e containersJ an
<6= Orer or act o# competent p$&lic a$t!ority.
It is important to point o$t t!at t!e a&o"e list o# ca$ses o# loss, estr$ction or eterioration *!ic! eCempt t!e common carrier #or
responsi&ility t!ere#or, is a close list. Ca$ses #allin% o$tsie t!e #ore%oin% list, e"en i# t!ey appear to constit$te a species o# #orce
ma?e$re #all *it!in t!e scope o# .rticle 1136, *!ic! pro"ies as #ollo*sH
%n all cases other than those mentioned in num#ers 1, &, ', ( and ) of the preceding article, if the goods are lost,
destro"ed or deteriorated, common carriers are presumed to have #een at fault or to have acted negligentl", unless
the" prove that the" o#served e*traordinar" diligence as re;$ire in .rticle 1133. <Emp!asis s$pplie=
.pplyin% t!e a&o"eE;$ote .rticles 1132 an 1136, *e note #irstly t!at t!e speci#ic ca$se alle%e in t!e instant case Q t!e !i?ac'in% o#
t!e carrierRs tr$c' Q oes not #all *it!in any o# t!e #i"e <6= cate%ories o# eCemptin% ca$ses liste in .rticle 1132. It *o$l #ollo*,
t!ere#ore, t!at t!e !i?ac'in% o# t!e carrierRs "e!icle m$st &e ealt *it! $ner t!e pro"isions o# .rticle 1136, in ot!er *ors, t!at t!e
pri"ate responent as common carrier is pres$me to !a"e &een at #a$lt or to !a"e acte ne%li%ently. T!is pres$mption, !o*e"er, may
&e o"ert!ro*n &y proo# o# eCtraorinary ili%ence on t!e part o# pri"ate responent.
0etitioner insists t!at pri"ate responent !a not o&ser"e eCtraorinary ili%ence in t!e care o# petitionerRs %oos. 0etitioner ar%$es
t!at in t!e circ$mstances o# t!is case, pri"ate responent s!o$l !a"e !ire a sec$rity %$ar pres$ma&ly to rie *it! t!e tr$c' carryin%
t!e D55 cartons o# Li&erty #ille mil'. :e o not &elie"e, !o*e"er, t!at in t!e instant case, t!e stanar o# eCtraorinary ili%ence
re;$ire pri"ate responent to retain a sec$rity %$ar to rie *it! t!e tr$c' an to en%a%e &ri%ans in a #ireli%!t at t!e ris' o# !is o*n li#e
an t!e li"es o# t!e ri"er an !is !elper.
T!e precise iss$e t!at *e aress !ere relates to t!e speci#ic re;$irements o# t!e $ty o# eCtraorinary ili%ence in t!e "i%ilance o"er
t!e %oos carrie in t!e speci#ic conteCt o# !i?ac'in% or arme ro&&ery.
.s note earlier, t!e $ty o# eCtraorinary ili%ence in t!e "i%ilance o"er %oos is, $ner .rticle 1133, %i"en aitional speci#ication not
only &y .rticles 1132 an 1136 &$t also &y .rticle 1126, n$m&ers 2, 6 an D, .rticle 1126 pro"ies in rele"ant partH
.ny o# t!e #ollo*in% or similar stip$lations s!all &e consiere $nreasona&le, $n?$st an contrary to p$&lic policyH
CCC CCC CCC
<6= t!at t!e common carrier s!all not &e responsi&le #or t!e acts or omissions o# !is or its
employeesJ
<D= t!at t!e common carrierRs lia&ility #or acts committe &y t!ie"es, or o# ro##ers *!o onot act
*it! grave or irresisti#le threat, violence or force, is ispense *it! or iminis!eJ an
<1= t!at t!e common carrier s!all not responsi&le #or t!e loss, estr$ction or eterioration o# %oos
on acco$nt o# t!e e#ecti"e conition o# t!e car "e!icle, s!ip, airplane or ot!er e;$ipment $se in
t!e contract o# carria%e. <Emp!asis s$pplie=
@ner .rticle 1126 <D= a&o"e, a common carrier is !el responsi&le Q an *ill not &e allo*e to i"est or to iminis! s$c! responsi&ility
Q e"en #or acts o# stran%ers li'e t!ie"es or ro&&ers, e*cept *!ere s$c! t!ie"es or ro&&ers in #act acte M*it! %ra"e or irresisti&le t!reat,
"iolence or #orce.M :e &elie"e an so !ol t!at t!e limits o# t!e $ty o# eCtraorinary ili%ence in t!e "i%ilance o"er t!e %oos carrie
are reac!e *!ere t!e %oos are lost as a res$lt o# a ro&&ery *!ic! is attene &y M%ra"e or irresisti&le t!reat, "iolence or #orce.M
In t!e instant case, arme men !el $p t!e secon tr$c' o*ne &y pri"ate responent *!ic! carrie petitionerRs car%o. T!e recor
s!o*s t!at an in#ormation #or ro&&ery in &an *as #ile in t!e Co$rt o# First Instance o# Tarlac, >ranc! 4, in Criminal Case No. 19B
entitle M+eople of the +hilippines v. ,elipe -oncorno, .apoleon +resno, Armando Mesina, /scar /ria and one John Doe.M T!ere, t!e
acc$se *ere c!ar%e *it! *ill#$lly an $nla*#$lly ta'in% an carryin% a*ay *it! t!em t!e secon tr$c', ri"en &y Man$el Estraa an
loae *it! t!e D55 cartons o# Li&erty #ille mil' estine #or eli"ery at petitionerRs store in @raneta, 0an%asinan. T!e ecision o# t!e
trial co$rt s!o*s t!at t!e acc$se acte *it! %ra"e, i# not irresisti&le, t!reat, "iolence or #orce.
3
T!ree <3= o# t!e #i"e <6= !olE$ppers
*ere arme *it! #irearms. T!e ro&&ers not only too' a*ay t!e tr$c' an its car%o &$t also 'inappe t!e ri"er an !is !elper,
etainin% t!em #or se"eral ays an later releasin% t!em in anot!er pro"ince <in Sam&ales=. T!e !i?ac'e tr$c' *as s$&se;$ently #o$n
&y t!e police in T$e/on City. T!e Co$rt o# First Instance con"icte all t!e acc$se o# ro&&ery, t!o$%! not o# ro&&ery in &an.
4
In t!ese circ$mstances, *e !ol t!at t!e occ$rrence o# t!e loss m$st reasona&ly &e re%are as ;$ite &eyon t!e control o# t!e
common carrier an properly re%are as a #ort$ito$s e"ent. It is necessary to recall t!at e"en common carriers are not mae a&sol$te
ins$rers a%ainst all ris's o# tra"el an o# transport o# %oos, an are not !el lia&le #or acts or e"ents *!ic! cannot &e #oreseen or are
ine"ita&le, pro"ie t!at t!ey s!all !a"e complie *it! t!e ri%oro$s stanar o# eCtraorinary ili%ence.
:e, t!ere#ore, a%ree *it! t!e res$lt reac!e &y t!e Co$rt o# .ppeals t!at pri"ate responent Cenana is not lia&le #or t!e "al$e o# t!e
$neli"ere merc!anise *!ic! *as lost &eca$se o# an e"ent entirely &eyon pri"ate responentRs control.
.CCORDIN-LU, t!e 0etition #or Re"ie* on certiorari is !ere&y DENIED an t!e Decision o# t!e Co$rt o# .ppeals ate 3 .$%$st 1911
is .FFIRMED. No prono$ncement as to costs.
SO ORDERED.
,ernan, C.J., 0utierrez, Jr., -idin and Cortes, JJ., concur.

FIRST DIVISION
[G.R. No. 141710. August 4, 2002]
!G INSRANCE COR"ORATION, petitioner, vs. G.". SARMIENTO TRC<ING COR"ORATION #$% LAM=ERT M.
EROLES, respondents.
( E C I S I O N
&ITG, J.+
-.0. Sarmiento Tr$c'in% Corporation <-0S= $nertoo' to eli"er on 1B )$ne 1992 t!irty <35= $nits o# Con$ra S.D. *!ite
re#ri%erators a&oar one o# its Is$/$ tr$c', ri"en &y Lam&ert Eroles, #rom t!e plant site o# Concepcion In$stries, Inc., alon% So$t!
S$per!i%!*ay in .la&an%, Metro Manila, to t!e Central L$/on .ppliances in Da%$pan City. :!ile t!e tr$c' *as tra"ersin% t!e nort!
i"ersion roa alon% Mc.rt!$r !i%!*ay in >aran%ay .n$pol, >am&an, Tarlac, it collie *it! an $nienti#ie tr$c', ca$sin% it to #all into a
eep canal, res$ltin% in ama%e to t!e car%oes.
F-@ Ins$rance Corporation <F-@=, an ins$rer o# t!e s!ipment, pai to Concepcion In$stries, Inc., t!e "al$e o# t!e co"ere
car%oes in t!e s$m o# 0452,265.55. F-@, in t$rn, &ein% t!e s$&ro%ee o# t!e ri%!ts an interests o# Concepcion In$stries, Inc., so$%!t
reim&$rsement o# t!e amo$nt it !a pai to t!e latter #rom -0S. Since t!e tr$c'in% company #aile to !ee t!e claim, F-@ #ile a
complaint #or ama%es an &reac! o# contract o# carria%e a%ainst -0S an its ri"er Lam&ert Eroles *it! t!e Re%ional Trial Co$rt,
>ranc! DD, o# Ma'ati City. In its ans*er, responents asserte t!at -0S *as t!e eCcl$si"e !a$ler only o# Concepcion In$stries, Inc.,
since 19BB, an it *as not so en%a%e in &$siness as a common carrier. Responents #$rt!er claime t!at t!e ca$se o# ama%e *as
p$rely acciental.
T!e iss$es !a"in% t!$s &een ?oine, F-@ presente its e"ience, esta&lis!in% t!e eCtent o# ama%e to t!e car%oes an t!e
amo$nt it !a pai to t!e ass$re. -0S, instea o# s$&mittin% its e"ience, #ile *it! lea"e o# co$rt a motion to ismiss t!e complaint
&y *ay o# em$rrer to e"ience on t!e %ro$n t!at petitioner !a #aile to pro"e t!at it *as a common carrier.
T!e trial co$rt, in its orer o# 35 .pril 199D,
F1G
%rante t!e motion to ismiss, eCplainin% t!$slyH
(@ner Section 1 o# R$le 131 o# t!e R$les o# Co$rt, it is pro"ie t!at VEac! party m$st pro"e !is o*n a##irmati"e alle%ation, CCC.8
(In t!e instant case, plainti## i not present any sin%le e"ience t!at *o$l pro"e t!at e#enant is a common carrier.
(C C C C C C C C C
(.ccorin%ly, t!e application o# t!e la* on common carriers is not *arrante an t!e pres$mption o# #a$lt or ne%li%ence on t!e part o# a
common carrier in case o# loss, ama%e or eterioration o# %oos $rin% transport $ner 1136 o# t!e Ci"il Coe is not a"ailin%.
(T!$s, t!e la*s %o"ernin% t!e contract &et*een t!e o*ner o# t!e car%o to *!om t!e plainti## *as s$&ro%ate an t!e o*ner o# t!e
"e!icle *!ic! transports t!e car%o are t!e la*s on o&li%ation an contract o# t!e Ci"il Coe as *ell as t!e la* on ;$asi elicts.
(@ner t!e la* on o&li%ation an contract, ne%li%ence or #a$lt is not pres$me. T!e la* on ;$asi elict pro"ies #or some pres$mption
o# ne%li%ence &$t only $pon t!e attenance o# some circ$mstances. T!$s, .rticle 41B6 pro"iesH
V.rt. 41B6. @nless t!ere is proo# to t!e contrary, it is pres$me t!at a person ri"in% a motor "e!icle !as &een ne%li%ent i# at t!e time o#
t!e mis!ap, !e *as "iolatin% any tra##ic re%$lation.8
(E"ience #or t!e plainti## s!o*s no proo# t!at e#enant *as "iolatin% any tra##ic re%$lation. ,ence, t!e pres$mption o# ne%li%ence is
not o&tainin%.
(Consierin% t!at plainti## #aile to a$ce e"ience t!at e#enant is a common carrier an e#enant8s ri"er *as t!e one ne%li%ent,
e#enant cannot &e mae lia&le #or t!e ama%es o# t!e s$&?ect car%oes.+
F4G
T!e s$&se;$ent motion #or reconsieration !a"in% &een enie,
F3G
plainti## interpose an appeal to t!e Co$rt o# .ppeals,
contenin% t!at t!e trial co$rt !a erre <a= in !olin% t!at t!e appellee corporation *as not a common carrier e#ine $ner t!e la*
an eCistin% ?$rispr$enceJ an <&= in ismissin% t!e complaint on a em$rrer to e"ience.
T!e Co$rt o# .ppeals re?ecte t!e appeal o# petitioner an r$le in #a"or o# -0S. T!e appellate co$rt, in its ecision o# 15 )$ne
1999,
F2G
isco$rse, amon% ot!er t!in%s, t!at E
MC C C in orer #or t!e pres$mption o# ne%li%ence pro"ie #or $ner t!e la* %o"ernin% common carrier <.rticle 1136, Ci"il Coe= to
arise, t!e appellant m$st #irst pro"e t!at t!e appellee is a common carrier. S!o$l t!e appellant #ail to pro"e t!at t!e appellee is a
common carrier, t!e pres$mption *o$l not ariseJ conse;$ently, t!e appellant *o$l !a"e to pro"e t!at t!e carrier *as ne%li%ent.
MC C C C C C C C C
M>eca$se it is t!e appellant *!o insists t!at t!e appellees can still &e consiere as a common carrier, espite its Wlimite clientele,8
<ass$min% it *as really a common carrier=, it #ollo*s t!at it <appellant= !as t!e &$ren o# pro"in% t!e same. It <plainti##Eappellant= Wm$st
esta&lis! !is case &y a preponerance o# e"ience, *!ic! means t!at t!e e"ience as a *!ole a$ce &y one sie is s$perior to t!at
o# t!e ot!er.8 <S$mma Ins$rance Corporation "s. Co$rt o# .ppeals, 423 SCR. 116=. T!is, $n#ort$nately, t!e appellant #aile to o
EE !ence, t!e ismissal o# t!e plainti##8s complaint &y t!e trial co$rt is ?$sti#ie.
MC C C C C C C C C
M>ase on t!e #ore%oin% is;$isitions an consierin% t!e circ$mstances t!at t!e appellee tr$c'in% corporation !as &een Wits eCcl$si"e
contractor, !a$ler since 1915, e#enant !as no c!oice &$t to comply *it! t!e irecti"e o# its principal,8 t!e ine"ita&le concl$sion is t!at
t!e appellee is a pri"ate carrier.
MC C C C C C C C C
MC C C t!e lo*er co$rt correctly r$le t!at Rt!e application o# t!e la* on common carriers is not *arrante an t!e pres$mption o# #a$lt or
ne%li%ence on t!e part o# a common carrier in case o# loss, ama%e or eterioration o# %ooFsG $rin% transport $ner FarticleG 1136 o#
t!e Ci"il Coe is not a"ailin%.R C C C.
MFinally, :e a"ert to t!e lon% esta&lis!e r$le t!at concl$sions an #inin%s o# #act o# a trial co$rt are entitle to %reat *ei%!t on appeal
an s!o$l not &e ist$r&e $nless #or stron% an "ali reasons.M
F6G
0etitionerRs motion #or reconsieration *as li'e*ise enieJ
FDG
!ence, t!e instant petition,
F1G
raisin% t!e #ollo*in% iss$esH
I
:,ET,ER RES0ONDENT -0S M.U >E CONSIDERED .S . COMMON C.RRIER .S DEFINED @NDER T,E L.: .ND EKISTIN-
)@RIS0R@DENCE.
II
:,ET,ER RES0ONDENT -0S, EIT,ER .S . COMMON C.RRIER OR . 0RIV.TE C.RRIER, M.U >E 0RES@MED TO ,.VE
>EEN NE-LI-ENT :,EN T,E -OODS IT @NDERTOOX TO TR.NS0ORT S.FELU :ERE S@>SET@ENTLU D.M.-ED :,ILE IN
ITS 0ROTECTIVE C@STODU .ND 0OSSESSION.
III
:,ET,ER T,E DOCTRINE OF 123 %+3A 4/56%761 IS .00LIC.>LE IN T,E INST.NT C.SE.
On t!e #irst iss$e, t!e Co$rt #ins t!e concl$sion o# t!e trial co$rt an t!e Co$rt o# .ppeals to &e amply ?$sti#ie. -0S, &ein% an
eCcl$si"e contractor an !a$ler o# Concepcion In$stries, Inc., renerin% or o##erin% its ser"ices to no ot!er ini"i$al or entity, cannot
&e consiere a common carrier. Common carriers are persons, corporations, #irms or associations en%a%e in t!e &$siness o#
carryin% or transportin% passen%ers or %oos or &ot!, &y lan, *ater, or air, #or !ire or compensation, o##erin% t!eir ser"ices to
t!e 2u;1.0,
FBG
*!et!er to t!e p$&lic in %eneral or to a limite clientele in partic$lar, &$t ne"er on an eCcl$si"e &asis.
F9G
T!e tr$e test o# a
common carrier is t!e carria%e o# passen%ers or %oos, pro"iin% space #or t!ose *!o opt to a"ail t!emsel"es o# its transportation
ser"ice #or a #ee.
F15G
-i"en accepte stanars, -0S scarcely #alls *it!in t!e term (common carrier.+
T!e a&o"e concl$sion not!*it!stanin%, -0S cannot escape #rom lia&ility.
In culpa contractual, $pon *!ic! t!e action o# petitioner rests as &ein% t!e s$&ro%ee o# Concepcion In$stries, Inc., t!e mere proo#
o# t!e eCistence o# t!e contract an t!e #ail$re o# its compliance ?$sti#y, prima facie, a corresponin% ri%!t o# relie#.
F11G
T!e la*,
reco%ni/in% t!e o&li%atory #orce o# contracts,
F14G
*ill not permit a party to &e set #ree #rom lia&ility #or any 'in o# misper#ormance o# t!e
contract$al $nerta'in% or a contra"ention o# t!e tenor t!ereo#.
F13G
. &reac! $pon t!e contract con#ers $pon t!e in?$re party a "ali
ca$se #or reco"erin% t!at *!ic! may !a"e &een lost or s$##ere. T!e remey ser"es to preser"e t!e interests o# t!e promisee t!at may
incl$e !is (eCpectation interest,+ *!ic! is !is interest in !a"in% t!e &ene#it o# !is &ar%ain &y &ein% p$t in as %oo a position as !e *o$l
!a"e &een in !a t!e contract &een per#orme, or !is (reliance interest,+ *!ic! is !is interest in &ein% reim&$rse #or loss ca$se &y
reliance on t!e contract &y &ein% p$t in as %oo a position as !e *o$l !a"e &een in !a t!e contract not &een maeJ or !is (restit$tion
interest,+ *!ic! is !is interest in !a"in% restore to !im any &ene#it t!at !e !as con#erre on t!e ot!er party.
F12G
Inee, a%reements can
accomplis! little, eit!er #or t!eir ma'ers or #or society, $nless t!ey are mae t!e &asis #or action.
F16G
T!e e##ect o# e"ery in#raction is to
create a ne* $ty, t!at is, to ma'e recompense to t!e one *!o !as &een in?$re &y t!e #ail$re o# anot!er to o&ser"e !is contract$al
o&li%ation
F1DG
$nless !e can s!o* eCten$atin% circ$mstances, li'e proo# o# !is eCercise o# $e ili%ence <normally t!at o# t!e ili%ence o#
a %oo #at!er o# a #amily or, eCceptionally &y stip$lation or &y la* s$c! as in t!e case o# common carriers, t!at o# eCtraorinary
ili%ence= or o# t!e attenance o# #ort$ito$s e"ent, to eCc$se !im #rom !is ens$in% lia&ility.
Responent tr$c'in% corporation reco%ni/es t!e eCistence o# a contract o# carria%e &et*een it an petitioner8s ass$re, an
amits t!at t!e car%oes it !as ass$me to eli"er !a"e &een lost or ama%e *!ile in its c$stoy. In s$c! a sit$ation, a e#a$lt on, or
#ail$re o# compliance *it!, t!e o&li%ation 9 in t!is case, t!e eli"ery o# t!e %oos in its c$stoy to t!e place o# estination E %i"es rise to
a pres$mption o# lac' o# care an corresponin% lia&ility on t!e part o# t!e contract$al o&li%or t!e &$ren &ein% on !im to esta&lis!
ot!er*ise. -0S !as #aile to o so.
Responent ri"er, on t!e ot!er !an, *it!o$t concrete proo# o# !is ne%li%ence or #a$lt, may not !imsel# &e orere to pay
petitioner. T!e ri"er, not &ein% a party to t!e contract o# carria%e &et*een petitioner8s principal an e#enant, may not &e !el lia&le
$ner t!e a%reement. . contract can only &in t!e parties *!o !a"e entere into it or t!eir s$ccessors *!o !a"e ass$me t!eir
personality or t!eir ?$riical position.
F11G
Consonantly *it! t!e aCiom res inter alios acta aliis ne8ue nocet prodest, s$c! contract can
neit!er #a"or nor pre?$ice a t!ir person. 0etitioner8s ci"il action a%ainst t!e ri"er can only &e &ase on culpa a8uiliana, *!ic!,
$nli'e culpa contractual, *o$l re;$ire t!e claimant #or ama%es to pro"e ne%li%ence or #a$lt on t!e part o# t!e e#enant.
F1BG
. *or in passin%. 1es ipsa lo8uitur, a octrine &ein% in"o'e &y petitioner, !ols a e#enant lia&le *!ere t!e t!in% *!ic!
ca$se t!e in?$ry complaine o# is s!o*n to &e $ner t!e latter8s mana%ement an t!e accient is s$c! t!at, in t!e orinary co$rse o#
t!in%s, cannot &e eCpecte to !appen i# t!ose *!o !a"e its mana%ement or control $se proper care. It a##ors reasona&le e"ience, in
t!e a&sence o# eCplanation &y t!e e#enant, t!at t!e accient arose #rom *ant o# care.
F19G
It is not a r$le o# s$&stanti"e la* an, as
s$c!, it oes not create an inepenent %ro$n o# lia&ility. Instea, it is re%are as a moe o# proo#, or a mere proce$ral
con"enience since it #$rnis!es a s$&stit$te #or, an relie"es t!e plainti## o#, t!e &$ren o# pro$cin% speci#ic proo# o# ne%li%ence. T!e
maCim simply places on t!e e#enant t!e &$ren o# %oin% #or*ar *it! t!e proo#.
F45G
Resort to t!e octrine, !o*e"er, may &e allo*e
only *!en <a= t!e e"ent is o# a 'in *!ic! oes not orinarily occ$r in t!e a&sence o# ne%li%enceJ <&= ot!er responsi&le ca$ses,
incl$in% t!e con$ct o# t!e plainti## an t!ir persons, are s$##iciently eliminate &y t!e e"ienceJ an <c= t!e inicate ne%li%ence is
*it!in t!e scope o# t!e e#enantRs $ty to t!e plainti##.
F41G
T!$s, it is not applica&le *!en an $neCplaine accient may &e attri&$ta&le to
one o# se"eral ca$ses, #or some o# *!ic! t!e e#enant co$l not &e responsi&le.
F44G
1es ipsa lo8uitur %enerally #ins rele"ance *!et!er or not a contract$al relations!ip eCists &et*een t!e plainti## an t!e e#enant,
#or t!e in#erence o# ne%li%ence arises #rom t!e circ$mstances an nat$re o# t!e occ$rrence an not #rom t!e nat$re o# t!e relation o# t!e
parties.
F43G
Ne"ert!eless, t!e re;$irement t!at responsi&le ca$ses ot!er t!an t!ose $e to e#enant8s con$ct m$st #irst &e eliminate,
#or t!e octrine to apply, s!o$l &e $nerstoo as &ein% con#ine only to cases o# p$re <nonEcontract$al= tort since o&"io$sly t!e
pres$mption o# ne%li%ence in culpa contractual, as pre"io$sly so pointe o$t, immeiately attac!es &y a #ail$re o# t!e co"enant or its
tenor. In t!e case o# t!e tr$c' ri"er, *!ose lia&ility in a ci"il action is preicate on culpa ac8uiliana, *!ile !e amittely can &e sai to
!a"e &een in control an mana%ement o# t!e "e!icle *!ic! #i%$re in t!e accient, it is not e;$ally s!o*n, !o*e"er, t!at t!e accient
co$l !a"e &een eCcl$si"ely $e to !is ne%li%ence, a matter t!at can allo*, #ort!*it!, res ipsa lo8uitur to *or' a%ainst !im.
I# a em$rrer to e"ience is %rante &$t on appeal t!e orer o# ismissal is re"erse, t!e mo"ant s!all &e eeme to !a"e *ai"e
t!e ri%!t to present e"ience.
F42G
T!$s, responent corporation may no lon%er o##er proo# to esta&lis! t!at it !as eCercise $e care in
transportin% t!e car%oes o# t!e ass$re so as to still *arrant a reman o# t!e case to t!e trial co$rt.
3HERE!ORE, t!e orer, ate 35 .pril 199D, o# t!e Re%ional Trial Co$rt, >ranc! DD, o# Ma'ati City, an t!e ecision, ate 15
)$ne 1999, o# t!e Co$rt o# .ppeals, are .FFIRMED only inso#ar as responent Lam&ert M. Eroles is concerne, &$t sai assaile orer
o# t!e trial co$rt an ecision o# t!e appellate co$rt are REVERSED as re%ars -.0. Sarmiento Tr$c'in% Corporation *!ic!, instea, is
!ere&y orere to pay F-@ Ins$rance Corporation t!e "al$e o# t!e ama%e an lost car%oes in t!e amo$nt o# 0452,265.55. No costs.
SO OR(ERE(.
!IRST "HILI""INE IN(STRIAL COR"ORATION, petitioner, vs. CORT O! A""EALS, HONORA=LE "ATERNO &. TAC*AN,
=ATANGAS CIT) #$% A(ORACION C. ARELLANO, .$ >6, o//.0.#1 0#2#0.t- #s C.t- T,6#su,6, o/ =#t#$g#s, respondents.
( E C I S I O N
MARTINE8, J.+
T!is petition #or re"ie* on certiorari assails t!e Decision o# t!e Co$rt o# .ppeals ate No"em&er 49, 1996, in C.E-.R. S0 No.
3DB51, a##irmin% t!e ecision o# t!e Re%ional Trial Co$rt o# >atan%as City, >ranc! B2, in Ci"il Case No. 2493, *!ic! ismisse
petitionersR complaint #or a &$siness taC re#$n impose &y t!e City o# >atan%as.
0etitioner is a %rantee o# a pipeline concession $ner Rep$&lic .ct No. 3B1, as amene, to contract, install an operate oil
pipelines. T!e ori%inal pipeline concession *as %rante in 19D1
F1G
an rene*e &y t!e Ener%y Re%$latory >oar in 1994.
F4G
Sometime in )an$ary 1996, petitioner applie #or a mayorRs permit *it! t!e O##ice o# t!e Mayor o# >atan%as City. ,o*e"er, &e#ore
t!e mayorRs permit co$l &e iss$e, t!e responent City Treas$rer re;$ire petitioner to pay a local taC &ase on its %ross receipts #or
t!e #iscal year 1993 p$rs$ant to t!e Local -o"ernment Coe.
F3G
T!e responent City Treas$rer assesse a &$siness taC on t!e
petitioner amo$ntin% to 096D,51D.52 paya&le in #o$r installments &ase on t!e %ross receipts #or pro$cts p$mpe at -0SE1 #or t!e
#iscal year 1993 *!ic! amo$nte to 01B1,DB1,161.55. In orer not to !amper its operations, petitioner pai t!e taC $ner protest in t!e
amo$nt o# 0439,519.51 #or t!e #irst ;$arter o# 1993.
On )an$ary 45, 1992, petitioner #ile a letterEprotest aresse to t!e responent City Treas$rer, t!e pertinent portion o# *!ic!
reasH
M0lease note t!at o$r Company <F0IC= is a pipeline operator *it! a %o"ernment concession %rante $ner t!e 0etrole$m .ct. It is
en%a%e in t!e &$siness o# transportin% petrole$m pro$cts #rom t!e >atan%as re#ineries, "ia pipeline, to S$cat an )TF 0anacan
Terminals. .s s$c!, o$r Company is eCempt #rom payin% taC on %ross receipts $ner Section 133 o# t!e Local -o"ernment Coe o#
1991 C C C C
MMoreo"er, Transportation contractors are not incl$e in t!e en$meration o# contractors $ner Section 131, 0ara%rap! <!= o# t!e Local
-o"ernment Coe. T!ere#ore, t!e a$t!ority to impose taC Ron contractors an ot!er inepenent contractorsR $ner Section 123,
0ara%rap! <e= o# t!e Local -o"ernment Coe oes not incl$e t!e po*er to le"y on transportation contractors.
MT!e imposition an assessment cannot &e cate%ori/e as a mere #ee a$t!ori/e $ner Section 121 o# t!e Local -o"ernment
Coe. T!e sai section limits t!e imposition o# #ees an c!ar%es on &$siness to s$c! amo$nts as may &e commens$rate to t!e cost o#
re%$lation, inspection, an licensin%. ,ence, ass$min% ar%$eno t!at F0IC is lia&le #or t!e license #ee, t!e imposition t!ereo# &ase on
%ross receipts is "iolati"e o# t!e a#orecite pro"ision. T!e amo$nt o# 096D,51D.52 <0439,519.51 per ;$arter= is not commens$rate to
t!e cost o# re%$lation, inspection an licensin%. T!e #ee is alreay a re"en$e raisin% meas$re, an not a mere re%$latory imposition.M
F2G
On Marc! B, 1992, t!e responent City Treas$rer enie t!e protest contenin% t!at petitioner cannot &e consiere en%a%e in
transportation &$siness, t!$s it cannot claim eCemption $ner Section 133 <?= o# t!e Local -o"ernment Coe.
F6G
On )$ne 16, 1992, petitioner #ile *it! t!e Re%ional Trial Co$rt o# >atan%as City a complaint
FDG
#or taC re#$n *it! prayer #or a *rit
o# preliminary in?$nction a%ainst responents City o# >atan%as an .oracion .rellano in !er capacity as City Treas$rer. In its
complaint, petitioner alle%e, inter alia, t!atH <1= t!e imposition an collection o# t!e &$siness taC on its %ross receipts "iolates Section
133 o# t!e Local -o"ernment CoeJ <4= t!e a$t!ority o# cities to impose an collect a taC on t!e %ross receipts o# Mcontractors an
inepenent contractorsM $ner Sec. 121 <e= an 161 oes not incl$e t!e a$t!ority to collect s$c! taCes on transportation contractors
#or, as e#ine $ner Sec. 131 <!=, t!e term McontractorsM eCcl$es transportation contractorsJ an, <3= t!e City Treas$rer ille%ally an
erroneo$sly impose an collecte t!e sai taC, t!$s meritin% t!e immeiate re#$n o# t!e taC pai.
F1G
Tra"ersin% t!e complaint, t!e responents ar%$e t!at petitioner cannot &e eCempt #rom taCes $ner Section 133 <?= o# t!e Local
-o"ernment Coe as sai eCemption applies only to Mtransportation contractors an persons en%a%e in t!e transportation &y !ire an
common carriers &y air, lan an *ater.M Responents assert t!at pipelines are not incl$e in t!e term Mcommon carrierM *!ic! re#ers
solely to orinary carriers s$c! as tr$c's, trains, s!ips an t!e li'e. Responents #$rt!er posit t!at t!e term Mcommon carrierM $ner t!e
sai coe pertains to t!e moe or manner &y *!ic! a pro$ct is eli"ere to its estination.
FBG
On Octo&er 3, 1992, t!e trial co$rt renere a ecision ismissin% t!e complaint, r$lin% in t!is *iseH
MCCC 0lainti## is eit!er a contractor or ot!er inepenent contractor.
CCC t!e eCemption to taC claime &y t!e plainti## !as &ecome $nclear. It is a r$le t!at taC eCemptions are to &e strictly constr$e a%ainst
t!e taCpayer, taCes &ein% t!e li#e&loo o# t!e %o"ernment. ECemption may t!ere#ore &e %rante only &y clear an $ne;$i"ocal
pro"isions o# la*.
M0lainti## claims t!at it is a %rantee o# a pipeline concession $ner Rep$&lic .ct 3B1, <EC!i&it .= *!ose concession *as lately rene*e
&y t!e Ener%y Re%$latory >oar <EC!i&it >=. Uet neit!er sai la* nor t!e ee o# concession %rant any taC eCemption $pon t!e plainti##.
ME"en t!e Local -o"ernment Coe imposes a taC on #ranc!ise !olers $ner Sec. 131 o# t!e Local TaC Coe. S$c! &ein% t!e sit$ation
o&taine in t!is case <eCemption &ein% $nclear an e;$i"ocal= resort to istinctions or ot!er consierations may &e o# !elpH
1. T!at t!e eCemption %rante $ner Sec. 133 <?= encompasses only common carriers so as not to o"er&$ren
t!e riin% p$&lic or comm$ters *it! taCes. 0lainti## is not a common carrier, &$t a special carrier eCtenin%
its ser"ices an #acilities to a sin%le speci#ic or Mspecial c$stomerM $ner a Mspecial contract.M
4. T!e Local TaC Coe o# 1994 *as &asically enacte to %i"e more an e##ecti"e local a$tonomy to local
%o"ernments t!an t!e pre"io$s enactments, to ma'e t!em economically an #inancially "ia&le to ser"e t!e
people an isc!ar%e t!eir #$nctions *it! a concomitant o&li%ation to accept certain e"ol$tion o# po*ers, C
C C So, consistent *it! t!is policy e"en #ranc!ise %rantees are taCe <Sec. 131= an contractors are also
taCe $ner Sec. 123 <e= an 161 o# t!e Coe.M
F9G
0etitioner assaile t!e a#oresai ecision &e#ore t!is Co$rt via a petition #or re"ie*. On Fe&r$ary 41, 1996, *e re#erre t!e case
to t!e responent Co$rt o# .ppeals #or consieration an a?$ication.
F15G
On No"em&er 49, 1996, t!e responent co$rt renere a
ecision
F11G
a##irmin% t!e trial co$rtRs ismissal o# petitionerRs complaint. 0etitionerRs motion #or reconsieration *as enie on )$ly 1B,
199D.
F14G
,ence, t!is petition. .t #irst, t!e petition *as enie $e co$rse in a Resol$tion ate No"em&er 11, 199D.
F13G
0etitioner mo"e #or
a reconsieration *!ic! *as %rante &y t!is Co$rt in a Resol$tion
F12G
o# )an$ary 45, 1991. T!$s, t!e petition *as reinstate.
0etitioner claims t!at t!e responent Co$rt o# .ppeals erre in !olin% t!at <1= t!e petitioner is not a common carrier or a
transportation contractor, an <4= t!e eCemption so$%!t #or &y petitioner is not clear $ner t!e la*.
T!ere is merit in t!e petition.
. Mcommon carrierM may &e e#ine, &roaly, as one *!o !ols !imsel# o$t to t!e p$&lic as en%a%e in t!e &$siness o#
transportin% persons or property #rom place to place, #or compensation, o##erin% !is ser"ices to t!e p$&lic %enerally.
.rticle 1134 o# t!e Ci"il Coe e#ines a Mcommon carrierM as Many person, corporation, #irm or association en%a%e in t!e &$siness
o# carryin% or transportin% passen%ers or %oos or &ot!, &y lan, *ater, or air, #or compensation, o##erin% t!eir ser"ices to t!e p$&lic.M
T!e test #or eterminin% *!et!er a party is a common carrier o# %oos isH
1. ,e m$st &e en%a%e in t!e &$siness o# carryin% %oos #or ot!ers as a p$&lic employment, an m$st !ol !imsel# o$t
as reay to en%a%e in t!e transportation o# %oos #or person %enerally as a &$siness an not as a cas$al occ$pationJ
4. ,e m$st $nerta'e to carry %oos o# t!e 'in to *!ic! !is &$siness is con#ineJ
3. ,e m$st $nerta'e to carry &y t!e met!o &y *!ic! !is &$siness is con$cte an o"er !is esta&lis!e roasJ an
2. T!e transportation m$st &e #or !ire.
F16G
>ase on t!e a&o"e e#initions an re;$irements, t!ere is no o$&t t!at petitioner is a common carrier. It is en%a%e in t!e
&$siness o# transportin% or carryin% %oos, i.e. petrole$m pro$cts, #or !ire as a p$&lic employment. It $nerta'es to carry #or all
persons ini##erently, t!at is, to all persons *!o c!oose to employ its ser"ices, an transports t!e %oos &y lan an #or
compensation. T!e #act t!at petitioner !as a limite clientele oes not eCcl$e it #rom t!e e#inition o# a common carrier. In De
0uzman vs. Court of Appeals
F1DG
*e r$le t!atH
MT!e a&o"e article <.rt. 1134, Ci"il Coe= ma'es no istinction &et*een one *!ose principal &$siness acti"ity is t!e carryin% o# persons
or %oos or &ot!, an one *!o oes s$c! carryin% only as an ancillary acti"ity <in local iiom, as a RsielineR=. .rticle 1134 C C C #vo.%s
:#?.$g #$- %.st.$0t.o$ ;6t@66$ # 26,so$ o, 6$t6,2,.s6 o//6,.$g t,#$s2o,t#t.o$ s6,v.06 o$ # regular or scheduled basis #$%
o$6 o//6,.$g su0> s6,v.06 o$ #$ occasional, episodic or unscheduled basis. N6.t>6, %o6s A,t.016 1932 %.st.$gu.s> ;6t@66$ #
0#,,.6, o//6,.$g .ts s6,v.06s to t>6 Ageneral public,A ..6., t>6 g6$6,#1 0o::u$.t- o, 2o2u1#t.o$, #$% o$6 @>o o//6,s s6,v.06s o,
so1.0.ts ;us.$6ss o$1- /,o: # $#,,o@ segment o/ t>6 g6$6,#1 2o2u1#t.o$. 36 t>.$? t>#t A,t.016 1899 %61.;6,#t61- ,6/,#.$6% /,o:
:#?.$g su0> %.st.$0t.o$s.
So $nerstoo, t!e concept o# Rcommon carrierR $ner .rticle 1134 may &e seen to coincie neatly *it! t!e notion o# Rp$&lic ser"ice,R
$ner t!e 0$&lic Ser"ice .ct <Common*ealt! .ct No. 121D, as amene= *!ic! at least partially s$pplements t!e la* on common
carriers set #ort! in t!e Ci"il Coe. @ner Section 13, para%rap! <&= o# t!e 0$&lic Ser"ice .ct, Rp$&lic ser"iceR incl$esH
Re"ery person t!at no* or !erea#ter may o*n, operate, mana%e, or control in t!e 0!ilippines, #or !ire or compensation, $ith general or
limited clientele, $hether permanent, occasional or accidental, and done for general #usiness purposes, an" common carrier, railroa,
street rail*ay, traction rail*ay, s$&*ay motor "e!icle, eit!er #or #rei%!t or passen%er, or &ot!, *it! or *it!o$t #iCe ro$te an *!ate"er
may &e its classi#ication, #rei%!t or carrier ser"ice o# any class, eCpress ser"ice, steam&oat, or steams!ip line, pontines, #erries an
*ater cra#t,6$g#g6% .$ t>6 t,#$s2o,t#t.o$ o/ passen%ers or #rei%!t or &ot!, s!ipyar, marine repair s!op, *!ar# or oc', ice plant, iceE
re#ri%eration plant, canal, irri%ation system %as, electric li%!t !eat an po*er, *ater s$pply an 2o@6, 26t,o16u:, se*era%e system,
*ire or *ireless comm$nications systems, *ire or *ireless &roacastin% stations an ot!er similar p$&lic ser"ices.R M<@nerscorin%
S$pplie=
.lso, responentRs ar%$ment t!at t!e term Mcommon carrierM as $se in Section 133 <?= o# t!e Local -o"ernment Coe re#ers only
to common carriers transportin% %oos an passen%ers t!ro$%! mo"in% "e!icles or "essels eit!er &y lan, sea or *ater, is erroneo$s.
.s correctly pointe o$t &y petitioner, t!e e#inition o# Mcommon carriersM in t!e Ci"il Coe ma'es no istinction as to t!e means o#
transportin%, as lon% as it is &y lan, *ater or air. It oes not pro"ie t!at t!e transportation o# t!e passen%ers or %oos s!o$l &e &y
motor "e!icle. In #act, in t!e @nite States, oil pipe line operators are consiere common carriers.
F11G
@ner t!e 0etrole$m .ct o# t!e 0!ilippines <Rep$&lic .ct 3B1=, petitioner is consiere a Mcommon carrier.M T!$s, .rticle BD
t!ereo# pro"ies t!atH
M.rt. BD. ".26 1.$6 0o$06ss.o$#.,6 #s # 0o::o$ 0#,,.6,. E . pipe line s!all !a"e t!e pre#erential ri%!t to $tili/e installations #or t!e
transportation o# petrole$m o*ne &y !im, &$t is o&li%ate to $tili/e t!e remainin% transportation capacity pro rata #or t!e transportation
o# s$c! ot!er petrole$m as may &e o##ere &y ot!ers #or transport, an to c!ar%e *it!o$t iscrimination s$c! rates as may !a"e &een
appro"e &y t!e Secretary o# .%ric$lt$re an Nat$ral Reso$rces.M
Rep$&lic .ct 3B1 also re%ars petrole$m operation as a p$&lic $tility. 0ertinent portion o# .rticle 1 t!ereo# pro"iesH
Mt!at e"eryt!in% relatin% to t!e eCploration #or an eCploitation o# petrole$m C C an e"eryt!in% relatin% to t!e man$#act$re, re#inin%,
stora%e, or t,#$s2o,t#t.o$ ;- s260.#1 :6t>o%s o/ 26t,o16u:, is !ere&y eclare to &e a 2u;1.0 ut.1.t-.M <@nerscorin% S$pplie=
T!e >$rea$ o# Internal Re"en$e li'e*ise consiers t!e petitioner a Mcommon carrier.M In >IR R$lin% No. 5D9EB3, it eclareH
MC C C since FpetitionerG is a pipeline concessionaire t!at is en%a%e only in transportin% petrole$m pro$cts, it is consiere a common
carrier $ner Rep$&lic .ct No. 3B1 C C C. S$c! &ein% t!e case, it is not s$&?ect to *it!!olin% taC prescri&e &y Re"en$e Re%$lations
No. 13E1B, as amene.M
From t!e #ore%oin% is;$isition, t!ere is no o$&t t!at petitioner is a Mcommon carrierM an, t!ere#ore, eCempt #rom t!e &$siness
taC as pro"ie #or in Section 133 <?=, o# t!e Local -o"ernment Coe, to *itH
MSection 133. Common 4imitations on the 7a*ing +o$ers of 4ocal 0overnment 6nits. E @nless ot!er*ise pro"ie !erein, t!e eCercise
o# t!e taCin% po*ers o# pro"inces, cities, m$nicipalities, an &aran%ays s!all not eCten to t!e le"y o# t!e #ollo*in% H
C C C C C C C C C
<?= TaCes on t!e %ross receipts o# transportation contractors an persons en%a%e in t!e transportation o# passen%ers or
#rei%!t &y !ire an common carriers &y air, lan or *ater, eCcept as pro"ie in t!is Coe.M
T!e eli&erations con$cte in t!e ,o$se o# Representati"es on t!e Local -o"ernment Coe o# 1991 are ill$minatin%H
MMR. .T@INO <.=. T!an' yo$, Mr. Spea'er.
Mr. Spea'er, *e *o$l li'e to procee to pa%e 96, line 1. It states H MSEC.141 Fno* Sec. 131G. Common Limitations on t!e TaCin%
0o*ers o# Local -o"ernment @nits.M C C C
MR. .T@INO <..=. T!an' yo$ Mr. Spea'er.
Still on pa%e 96, s$&para%rap! 6, on taCes on t!e &$siness o# transportation. T!is appears to &e one o# t!ose &ein% eeme to &e
eCempte #rom t!e taCin% po*ers o# t!e local %o"ernment $nits. M#- @6 ?$o@ t>6 ,6#so$ @>- t>6 t,#$s2o,t#t.o$ ;us.$6ss .s
;6.$g 6B01u%6% /,o: t>6 t#B.$g 2o@6,s o/ t>6 1o0#1 gov6,$:6$t u$.tsC
MR. ).VIER <E.=. Mr. Spea'er, t!ere is an eCception containe in Section 141 <no* Sec. 131=, line 1D, para%rap! 6. It states t!at local
%o"ernment $nits may not impose taCes on t!e &$siness o# transportation, eCcept as ot!er*ise pro"ie in t!is coe.
No*, Mr. Spea'er, i# t!e -entleman *o$l care to %o to pa%e 9B o# >oo' II, one can see t!ere t!at pro"inces !a"e t!e po*er to impose
a taC on &$siness en?oyin% a #ranc!ise at t!e rate o# not more t!an oneE!al# o# 1 percent o# t!e %ross ann$al receipts. So,
transportation contractors *!o are en?oyin% a #ranc!ise *o$l &e s$&?ect to taC &y t!e pro"ince. T!at is t!e eCception, Mr. Spea'er.
3>#t @6 @#$t to gu#,% #g#.$st >6,6, M,. S26#?6,, .s t>6 .:2os.t.o$ o/ t#B6s ;- 1o0#1 gov6,$:6$t u$.ts o$ t>6 0#,,.6,
;us.$6ss. Local %o"ernment $nits may impose taCes on top o# *!at is alreay &ein% impose &y t!e National Internal Re"en$e Coe
*!ic! is t!e soEcalle Mcommon carriers taC.M 36 %o $ot @#$t # %u21.0#t.o$ o/ t>.s t#B, so @6 Dust 2,ov.%6% /o, #$ 6B062t.o$ $ner
Section 146 Fno* Sec. 131G t!at a pro"ince may impose t!is taC at a speci#ic rate.
MR. .T@INO <..=. T>#$? -ou /o, t>#t 01#,./.0#t.o$, M,. S26#?6,. C C C
F1BG
It is clear t!at t!e le%islati"e intent in eCcl$in% #rom t!e taCin% po*er o# t!e local %o"ernment $nit t!e imposition o# &$siness taC
a%ainst common carriers is to pre"ent a $plication o# t!e soEcalle Mcommon carrierRs taC.M
0etitioner is alreay payin% t!ree <37= percent common carrierRs taC on its %ross salesIearnin%s $ner t!e National Internal
Re"en$e Coe.
F19G
To taC petitioner a%ain on its %ross receipts in its transportation o# petrole$m &$siness *o$l e#eat t!e p$rpose o#
t!e Local -o"ernment Coe.
3HERE!ORE, t!e petition is !ere&y -R.NTED. T!e ecision o# t!e responent Co$rt o# .ppeals ate No"em&er 49, 1996 in
C.E-.R. S0 No. 3DB51 is REVERSED an SET .SIDE.
SO OR(ERE(.
-ellosillo, (Chairman), +uno, an Mendoza, JJ., conc$r.
T,IRD DIVISION
[G.R. No. 112289. (606:;6, 12, 1779]
NATIONAL STEEL COR"ORATION, petitioner, vs. CORT O! A""EALS AN( &LASONS SHI""ING, INC., respondents.
[G.R. No. 112350. (606:;6, 12, 1779]
&LASONS SHI""ING, INC., petitioner, vs. CORT O! A""EALS AN( NATIONAL STEEL COR"ORATION, respondents.
( E C I S I O N
"ANGANI=AN, J.+
T!e Co$rt #ins occasion to apply t!e r$les on t!e sea*ort!iness o# a private carrier, its o*ner8s responsi&ility #or ama%e to t!e
car%o an its lia&ility #or em$rra%e an attorney8s #ees. T!e Co$rt also reiterates t!e *ellE'no*n r$le t!at #inin%s o# #acts o# trial
co$rts, *!en a##irme &y t!e Co$rt o# .ppeals, are &inin% on t!is Co$rt.
T>6 C#s6
>e#ore $s are t*o separate petitions #or re"ie* #ile &y National Steel Corporation <NSC= an Vlasons S!ippin%, Inc. <VSI=, &ot! o#
*!ic! assail t!e .$%$st 14, 1993 Decision o# t!e Co$rt o# .ppeals.
F1G
T!e Co$rt o# .ppeals moi#ie t!e ecision o# t!e Re%ional Trial
Co$rt o# 0asi%, Metro Manila, >ranc! 1D3 in Ci"il Case No. 43311. T!e RTC ispose as #ollo*sH
(:,EREFORE, ?$%ment is !ere&y renere in #a"or o# e#enant an a%ainst t!e plainti## ismissin% t!e complaint *it! cost a%ainst
plainti##, an orerin% plainti## to pay t!e e#enant on t!e co$nterclaim as #ollo*sH
1. T!e s$m o# 016,555.55 as $npai #rei%!t an 0BB,555.55 as em$rra%e *it! interest at t!e le%al rate on &ot! amo$nts
#rom .pril 1, 191D $ntil t!e same s!all !a"e &een #$lly paiJ
4. .ttorney8s #ees an eCpenses o# liti%ation in t!e s$m o# 0155,555.55J an
3. Cost o# s$it.
SO ORDERED.+
F4G
On t!e ot!er !an, t!e Co$rt o# .ppeals r$leH
(:,EREFORE, premises consiere, t!e ecision appeale #rom is moi#ie &y re$cin% t!e a*ar #or em$rra%e to 022,555.55 an
eletin% t!e a*ar #or attorney8s #ees an eCpenses o# liti%ation. ECcept as t!$s moi#ie, t!e ecision is .FFIRMED. T!ere is no
prono$ncement as to costs.
SO ORDERED.+
F3G
T>6 !#0ts
T!e MV Vlasons % is a "essel *!ic! reners trampin% ser"ice an, as s$c!, oes not transport car%o or s!ipment #or t!e %eneral
p$&lic. Its ser"ices are a"aila&le only to speci#ic persons *!o enter into a special contract o# c!arter party *it! its o*ner. It is
$nisp$te t!at t!e s!ip is a pri"ate carrier. .n it is in t!is capacity t!at its o*ner, Vlasons S!ippin%, Inc., entere into a contract o#
a##rei%!tment or contract o# "oya%e c!arter !ire *it! National Steel Corporation.
T!e #acts as #o$n &y Responent Co$rt o# .ppeals are as #ollo*sH
(<1= On )$ly 11, 1912, plainti## National Steel Corporation <NSC= as C!arterer an e#enant Vlasons S!ippin%, Inc. <VSI= as O*ner,
entere into a Contract o# Voya%e C!arter ,ire <EC!i&it V>8J also EC!i&it V18= *!ere&y NSC !ire VSI8s "essel, t!e MV VVL.SONS I8 to
ma'e one <1= "oya%e to loa steel pro$cts at Ili%an City an isc!ar%e t!em at Nort! ,ar&or, Manila, $ner t!e #ollo*in% terms an
conitions, viz9
V1. C C C C C C.
4. Car%oH F$ll car%o o# steel pro$cts o# not less t!an 4,655 MT, 157 more or less at Master8s option.
3. C C C C C C
2. Frei%!tI0aymentH 035.55 Imetric ton, FIOST &asis. 0ayment $pon presentation o# >ill o# Lain% *it!in #i#teen <16= ays.
6. LayaysICancellin%H )$ly 4D, 1912I.$%. 6, 1912.
D. Loain%IDisc!ar%in% RateH 165 tons per ::DS,INC. <:eat!er :or'in% Day o# 42 consec$ti"e !o$rs, S$nays an ,oliays
Incl$e=.
1. Dem$rra%eIDispatc!H 0B,555.55I02,555.55 per ay.
B. C C C C C C
9. Car%o Ins$ranceH C!arterer8s anIor S!ipper8s m$st ins$re t!e car%oes. S!ipo*ners not responsi&le #or lossesIama%es eCcept on
pro"en *ill#$l ne%li%ence o# t!e o##icers o# t!e "essel.
15. Ot!er termsH<a= .ll termsIconitions o# NONU.S.I CI0 FsicG or ot!er internationally reco%ni/e C!arter 0arty .%reement s!all #orm
part o# t!is Contract.
C C C C C C C C C8
T!e terms VF.I.O.S.T.8 *!ic! is $se in t!e s!ippin% &$siness is a stanar pro"ision in t!e N.NUOS.I C!arter 0arty *!ic! stans #or
VFrei%!t In an O$t incl$in% Ste"eorin% an Train%8, *!ic! means t!at t!e !anlin%, loain% an $nloain% o# t!e car%oes are t!e
responsi&ility o# t!e C!arterer. @ner 0ara%rap! 6 o# t!e N.NUOS.I C!arter 0arty, it states, VC!arterers to loa, sto* an isc!ar%e
t!e car%o #ree o# ris' an eCpenses to o*ners. C C C8 <@nerscorin% s$pplie=.
@ner para%rap! 15 t!ereo#, it is pro"ie t!at V<o=*ners s!all, &e#ore an at t!e &e%innin% o# t!e "oya%e, eCercise $e ili%ence to
ma'e t!e "essel sea*ort!y an properly manne, e;$ippe an s$pplie an to ma'e t!e !ols an all ot!er parts o# t!e "essel in
*!ic! car%o is carrie, #it an sa#e #or its reception, carria%e an preser"ation. O*ners s!all not &e lia&le #or loss o# or ama%e o# t!e
car%o arisin% or res$ltin% #romH $nsea*ort!iness $nless ca$se &y *ant o# $e ili%ence on t!e part o# t!e o*ners to ma'e t!e "essel
sea*ort!y, an to sec$re t!at t!e "essel is properly manne, e;$ippe an s$pplie an to ma'e t!e !ols an all ot!er parts o# t!e
"essel in *!ic! car%o is carrie, #it an sa#e #or its reception, carria%e an preser"ationJ CCCJ perils, an%ers an accients o# t!e sea or
ot!er na"i%a&le *atersJ CCCJ *asta%e in &$l' or *ei%!t or any ot!er loss or ama%e arisin% #rom in!erent e#ect, ;$ality or "ice o# t!e
car%oJ ins$##iciency o# pac'in%J CCCJ latent e#ects not isco"era&le &y $e ili%enceJ any ot!er ca$se arisin% *it!o$t t!e act$al #a$lt or
pri"ity o# O*ners or *it!o$t t!e #a$lt o# t!e a%ents or ser"ants o# o*ners.8
0ara%rap! 14 o# sai N.NUOS.I C!arter 0arty also pro"ies t!at V<o=*ners s!all not &e responsi&le #or split, c!a#in% anIor any
ama%e $nless ca$se &y t!e ne%li%ence or e#a$lt o# t!e master an cre*.8
<4= On .$%$st D, 1 an B, 1912, in accorance *it! t!e Contract o# Voya%e C!arter ,ire, t!e MV VVL.SONS I8 loae at plainti##8s pier
at Ili%an City, t!e NSC8s s!ipment o# 1,D11 s'is o# tinplates an 94 pac'a%es o# !ot rolle s!eets or a total o# 1,1D9 pac'a%es *it! a
total *ei%!t o# a&o$t 4,2B1.19 metric tons #or carria%e to Manila. T!e s!ipment *as place in t!e t!ree <3= !atc!es o# t!e s!ip. C!ie#
Mate -on/alo Sa&ano, actin% as a%ent o# t!e "esselF,G ac'no*le%e receipt o# t!e car%o on &oar an si%ne t!e corresponin% &ill
o# lain%, >.L.0.0. No. 5433 <EC!i&it VD8= on .$%$st B, 1912.
<3= T!e "essel arri"e *it! t!e car%o at 0ier 14, Nort! ,ar&or, Manila, on .$%$st 14, 1912. T!e #ollo*in% ay, .$%$st 13, 1912, *!en
t!e "essel8s t!ree <3= !atc!es containin% t!e s!ipment *ere opene &y plainti##8s a%ents, nearly all t!e s'is o# tinplates an !ot rolle
s!eets *ere alle%ely #o$n to &e *et an r$sty. T!e car%o *as isc!ar%e an $nloae &y ste"eores !ire &y t!e
C!arterer. @nloain% *as complete only on .$%$st 42, 1912 a#ter inc$rrin% a elay o# ele"en <11= ays $e to t!e !ea"y rain *!ic!
interr$pte t!e $nloain% operations. <EC!i&it VE8=
<2= To etermine t!e nat$re an eCtent o# t!e *ettin% an r$stin%, NSC calle #or a s$r"ey o# t!e s!ipment &y t!e Manila .?$sters an
S$r"eyors Company <M.SCO=. In a letter to t!e NSC ate Marc! 11, 1916 <EC!i&it V-8=, M.SCO mae a report o# its oc$lar
inspection con$cte on t!e car%o, &ot! *!ile it *as still on &oar t!e "essel an later at t!e NDC *are!o$se in 0$re/a St., Sta. Mesa,
Manila *!ere t!e car%o *as ta'en an store. M.SCO reporte t!at it #o$n *ettin% an r$stin% o# t!e pac'a%es o# !ot rolle s!eets
an metal co"ers o# t!e tinplatesJ t!at tarpa$lin !atc! co"ers *ere note torn at "ario$s eCtentsJ t!at containerImetal casin%s o# t!e
s'is *ere r$stin% all o"er. M.SCO "ent$re t!e opinion t!at Vr$stin% o# t!e tinplates *as ca$se &y contact *it! SE. :.TER
s$staine *!ile still on &oar t!e "essel as a conse;$ence o# t!e !ea"y *eat!er an ro$%! seas enco$ntere *!ile en ro$te to
estination <EC!i&it VF8=. It *as also reporte t!at M.SCO8s s$r"eyors re* at ranom samples o# &a orer pac'in% materials o# t!e
tinplates an eli"ere t!e same to t!e M.I.T. Testin% La&oratories #or analysis. On .$%$st 31, 1912, t!e M.I.T. Testin% La&oratories
iss$e Report No. 1115 <EC!i&it VI8= *!ic! in part, states, VT!e analysis o# &a orer samples o# pac'in% materials CCC s!o*s t!at
*ettin% *as ca$se &y contact *it! SE. :.TER8.
<6= On Septem&er D, 1912, on t!e &asis o# t!e a#oresai Report No. 1115, plainti## #ile *it! t!e e#enant its claim #or ama%es
s$##ere $e to t!e o*n%rain% o# t!e ama%e tinplates in t!e amo$nt o# 0921,126.1B. T!en on Octo&er 3, 1912, plainti## #ormally
emane payment o# sai claim &$t e#enant VSI re#$se an #aile to pay. 0lainti## #ile its complaint a%ainst e#enant on .pril 41,
191D *!ic! *as oc'ete as Ci"il Case No. 43311, CFI, Ri/al.
<D= In its complaint, plainti## claime t!at it s$staine losses in t!e a#oresai amo$nt o# 0921,126.1B as a res$lt o# t!e act, ne%lect an
e#a$lt o# t!e master an cre* in t!e mana%ement o# t!e "essel as *ell as t!e *ant o# $e ili%ence on t!e part o# t!e e#enant to
ma'e t!e "essel sea*ort!y an to ma'e t!e !ols an all ot!er parts o# t!e "essel in *!ic! t!e car%o *as carrie, #it an sa#e #or its
reception, carria%e an preser"ation EE all in "iolation o# e#enant8s $nerta'in% $ner t!eir Contract o# Voya%e C!arter ,ire.
<1= In its ans*er, e#enant enie lia&ility #or t!e alle%e ama%e claimin% t!at t!e MV VVL.SONS I8 *as sea*ort!y in all respects #or
t!e carria%e o# plainti##8s car%oJ t!at sai "essel *as not a Vcommon carrier8 inasm$c! as s!e *as $ner "oya%e c!arter contract *it!
t!e plainti## as c!arterer $ner t!e c!arter partyJ t!at in t!e co$rse o# t!e "oya%e #rom Ili%an City to Manila, t!e MV VVL.SONS I8
enco$ntere "ery ro$%! seas, stron% *ins an a"erse *eat!er conition, ca$sin% stron% *ins an &i% *a"es to contin$o$sly po$n
a%ainst t!e "essel an sea*ater to o"er#lo* on its ec' an !atc! co"ersJ t!at $ner t!e Contract o# Voya%e C!arter ,ire, e#enant
s!all not &e responsi&le #or lossesIama%es eCcept on pro"en *ill#$l ne%li%ence o# t!e o##icers o# t!e "essel, t!at t!e o##icers o# sai MV
VVL.SONS I8 eCercise $e ili%ence an proper seamans!ip an *ere not *ill#$lly ne%li%entJ t!at #$rt!ermore t!e Voya%e C!arter
0arty pro"ies t!at loain% an isc!ar%in% o# t!e car%o *as on FIOST terms *!ic! means t!at t!e "essel *as #ree o# ris' an
eCpense in connection *it! t!e loain% an isc!ar%in% o# t!e car%oJ t!at t!e ama%e, i# any, *as $e to t!e in!erent e#ect, ;$ality or
"ice o# t!e car%o or to t!e ins$##icient pac'in% t!ereo# or to latent e#ect o# t!e car%o not isco"era&le &y $e ili%ence or to any ot!er
ca$se arisin% *it!o$t t!e act$al #a$lt or pri"ity o# e#enant an *it!o$t t!e #a$lt o# t!e a%ents or ser"ants o# e#enantJ conse;$ently,
e#enant is not lia&leJ t!at t!e ste"eores o# plainti## *!o isc!ar%e t!e car%o in Manila *ere ne%li%ent an i not eCercise $e care
in t!e isc!ar%e o# t!e car%oJ an t!at t!e car%o *as eCpose to rain an sea*ater spray *!ile on t!e pier or in transit #rom t!e pier to
plainti##8s *are!o$se a#ter isc!ar%e #rom t!e "esselJ an t!at plainti##8s claim *as !i%!ly spec$lati"e an %rossly eCa%%erate an t!at
t!e small stain mar's or s*eat mar's on t!e e%es o# t!e tinplates *ere ma%ni#ie an consiere total loss o# t!e car%o. Finally,
e#enant claime t!at it !a complie *it! all its $ties an o&li%ations $ner t!e Voya%e C!arter ,ire Contract an !a no
responsi&ility *!atsoe"er to plainti##. In t$rn, it alle%e t!e #ollo*in% co$nterclaimH
<a= T!at espite t!e #$ll an proper per#ormance &y e#enant o# its o&li%ations $ner t!e Voya%e C!arter ,ire Contract, plainti## #aile
an re#$se to pay t!e a%ree c!arter !ire o# 016,555.55 espite emans mae &y e#enantJ
<&= T!at $ner t!eir Voya%e C!arter ,ire Contract, plainti## !a a%ree to pay e#enant t!e s$m o# 0B,555.55 per ay #or
em$rra%e. T!e "essel *as on em$rra%e #or ele"en <11= ays in Manila *aitin% #or plainti## to isc!ar%e its car%o #rom t!e
"essel. T!$s, plainti## *as lia&le to pay e#enant em$rra%e in t!e total amo$nt o# 0BB,555.55.
<c= For #ilin% a clearly $n#o$ne ci"il action a%ainst e#enant, plainti## s!o$l &e orere to pay e#enant attorney8s #ees an all
eCpenses o# liti%ation in t!e amo$nt o# not less t!an 0155,555.55.
<B= From t!e e"ience presente &y &ot! parties, t!e trial co$rt came o$t *it! t!e #ollo*in% #inin%s *!ic! *ere set #ort! in its ecisionH
<a= T!e MV VVL.SONS I8 is a "essel o# 0!ilippine re%istry en%a%e in t!e trampin% ser"ice an is a"aila&le #or !ire only $ner special
contracts o# c!arter party as in t!is partic$lar case.
<&= T!at #or p$rposes o# t!e "oya%e co"ere &y t!e Contract o# Voya%e C!arter ,ire <EC!. V18=, t!e MV VVL.SONS I8 *as co"ere &y
t!e re;$ire sea*ort!iness certi#icates incl$in% t!e Certi#ication o# Classi#ication iss$e &y an international classi#ication society, t!e
NI00ON X.I)I XUOX.I <EC!. V28=J Coast*ise License #rom t!e >oar o# Transportation <EC!. V68=J International Loaline Certi#icate #rom
t!e 0!ilippine Coast -$ar <EC!. VD8=J Car%o S!ip Sa#ety E;$ipment Certi#icate also #rom t!e 0!ilippine Coast -$ar <EC!. V18=J S!ip
Raio Station License <EC!. VB8=J Certi#icate o# Inspection &y t!e 0!ilippine Coast -$ar <EC!. V148=J an Certi#icate o# .ppro"al #or
Con"ersion iss$e &y t!e >$rea$ o# C$stoms <EC!. V98=. T!at &ein% a "essel en%a%e in &ot! o"erseas an coast*ise trae, t!e MV
VVL.SONS I8 !as a !i%!er e%ree o# sea*ort!iness an sa#ety.
<c= >e#ore it proceee to Ili%an City to per#orm t!e "oya%e calle #or &y t!e Contract o# Voya%e C!arter ,ire, t!e MV VVL.SONS I8
$ner*ent ryoc'in% in Ce&$ an *as t!oro$%!ly inspecte &y t!e 0!ilippine Coast -$ar. In #act, s$&?ect "oya%e *as t!e "essel8s
#irst "oya%e a#ter t!e ryoc'in%. T!e e"ience s!o*s t!at t!e MV VVL.SONS I8 *as sea*ort!y an properly manne, e;$ippe an
s$pplie *!en it $nertoo' t!e "oya%e. It !a all t!e re;$ire certi#icates o# sea*ort!iness.
<= T!e car%oIs!ipment *as sec$rely sto*e in t!ree <3= !atc!es o# t!e s!ip. T!e !atc! openin%s *ere co"ere &y !atc!&oars *!ic!
*ere in t$rn co"ere &y t*o or o$&le tarpa$lins. T!e !atc! co"ers *ere *ater ti%!t. F$rt!ermore, $ner t!e !atc!&oars *ere steel
&eams to %i"e s$pport.
<e= T!e claim o# t!e plainti## t!at e#enant "iolate t!e contract o# carria%e is not s$pporte &y e"ience. T!e pro"isions o# t!e Ci"il
Coe on common carriers p$rs$ant to *!ic! t!ere eCists a pres$mption o# ne%li%ence in case o# loss or ama%e to t!e car%o are not
applica&le. .s to t!e ama%e to t!e tinplates *!ic! *as alle%ely $e to t!e *ettin% an r$stin% t!ereo#, t!ere is $nre&$tte testimony
o# *itness Vicente .n%lion%to t!at tinplates Vs*eat8 &y t!emsel"es *!en pac'e e"en *it!o$t &ein% in contract <sic= *it! *ater #rom
o$tsie especially *!en t!e *eat!er is &a or rainin%. T!e r$st ca$se &y s*eat or moist$re on t!e tinplates may &e consiere as a
loss or ama%e &$t t!en, e#enant cannot &e !el lia&le #or it p$rs$ant to .rticle 1132 o# t!e Ci"il Case *!ic! eCempts t!e carrier #rom
responsi&ility #or loss or ama%e arisin% #rom t!e Vc!aracter o# t!e %oos C C C8. .ll t!e 1,1D9 s'is o# t!e tinplates co$l not !a"e &een
ama%e &y *ater as claime &y plainti##. It *as s!o*n as claime &y plainti## t!at t!e tinplates t!emsel"es *ere *rappe in 'ra#t
paper linin% an corr$%ate car&oars co$l not &e a##ecte &y *ater #rom o$tsie.
<#= T!e ste"eores !ire &y t!e plainti## to isc!ar%e t!e car%o o# tinplates *ere ne%li%ent in not closin% t!e !atc! openin%s o# t!e MV
VVL.SONS I8 *!en rains occ$rre $rin% t!e isc!ar%in% o# t!e car%o t!$s allo*in% rain*ater to enter t!e !atc!es. It *as pro"en t!at
t!e ste"eores merely set $p temporary tents to co"er t!e !atc! openin%s in case o# rain so t!at it *o$l &e easy #or t!em to res$me
*or' *!en t!e rains stoppe &y ?$st remo"in% t!e tent or can"as. >eca$se o# t!is improper co"erin% o# t!e !atc!es &y t!e ste"eores
$rin% t!e isc!ar%in% an $nloain% operations *!ic! *ere interr$pte &y rains, rain*ater ri#te into t!e car%o t!ro$%! t!e !atc!
openin%s. 0$rs$ant to para%rap! 6 o# t!e N.NUOS.I FsicG C!arter 0arty *!ic! *as eCpressly mae part o# t!e Contract o# Voya%e
C!arter ,ire, t!e loain%, sto*in% an isc!ar%in% o# t!e car%o is t!e sole responsi&ility o# t!e plainti## c!arterer an e#enant carrier
!as no lia&ility #or *!ate"er ama%e may occ$r or may&e FsicG ca$se to t!e car%o in t!e process.
<%= It *as also esta&lis!e t!at t!e "essel enco$ntere ro$%! seas an &a *eat!er *!ile en ro$te #rom Ili%an City to Manila ca$sin%
sea *ater to splas! on t!e s!ip8s ec' on acco$nt o# *!ic! t!e master o# t!e "essel <Mr. .ntonio C. D$mlao= #ile a VMarine 0rotest8 on
.$%$st 13, 1912 <EC!. V168= *!ic! can &e in"o'e &y e#enant as a #orce ma?e$re t!at *o$l eCempt t!e e#enant #rom lia&ility.
<!= 0lainti## i not comply *it! t!e re;$irement prescri&e in para%rap! 9 o# t!e Voya%e C!arter ,ire contract t!at it *as to ins$re t!e
car%o &eca$se it i not. ,a plainti## complie *it! t!e re;$irement, t!en it co$l !a"e reco"ere its loss or ama%e #rom t!e
ins$rer. 0lainti## also "iolate t!e c!arter party contract *!en it loae not only Vsteel pro$cts8, i.e. steel &ars, an%$lar &ars an t!e li'e
&$t also tinplates an !ot rolle s!eets *!ic! are !i%! %rae car%o commanin% a !i%!er #rei%!t. T!$s plainti## *as a&le to s!ip !i%!
%rae car%o at a lo*er #rei%!t rate.
<I= .s re%ars e#enant8s co$nterclaim, t!e contract o# "oya%e c!arter !ire $ner para%rap! 2 t!ereo#, #iCe t!e #rei%!t at 035.55 per
metric ton paya&le to e#enant carrier $pon presentation o# t!e &ill o# lain% *it!in #i#teen <16= ays. 0lainti## !as not pai t!e total
#rei%!t $e o# 016,555.55 espite emans. T!e e"ience also s!o*e t!at t!e plainti## *as re;$ire an &o$n $ner para%rap! 1 o#
t!e same Voya%e C!arter ,ire contract to pay em$rra%e o# 0B,555.55 per ay o# elay in t!e $nloain% o# t!e car%oes. T!e elay
amo$nte to ele"en <11= ays t!ere&y ma'in% plainti## lia&le to pay e#enant #or em$rra%e in t!e amo$nt o# 0BB,555.55.
.ppealin% t!e RTC ecision to t!e Co$rt o# .ppeals, NSC alle%e siC errorsH
EI
T!e trial co$rt erre in #inin% t!at t!e MV VVL.SONS I8 *as sea*ort!y, properly manne, e;$ippe an s$pplie, an t!at t!ere is no
proo# o# *ill#$l ne%li%ence o# t!e "essel8s o##icers.
EII
T!e trial co$rt erre in #inin% t!at t!e r$stin% o# NSC8s tinplates *as $e to t!e in!erent nat$re or c!aracter o# t!e %oos an not $e to
contact *it! sea*ater.
EIII
T!e trial co$rt erre in #inin% t!at t!e ste"eores !ire &y NSC *ere ne%li%ent in t!e $nloain% o# NSC8s s!ipment.
EI&
T!e trial co$rt erre in eCemptin% VSI #rom lia&ility on t!e %ro$n o# #orce ma?e$re.
E&
T!e trial co$rt erre in #inin% t!at NSC "iolate t!e contract o# "oya%e c!arter !ire.
E&I
T!e trial co$rt erre in orerin% NSC to pay #rei%!t, em$rra%e an attorney8s #ees, to VSI.+
F2G
.s earlier state, t!e Co$rt o# .ppeals moi#ie t!e ecision o# t!e trial co$rt &y re$cin% t!e em$rra%e #rom 0BB,555.55
to 022,555.55 an eletin% t!e a*ar o# attorneys #ees an eCpenses o# liti%ation. NSC an VSI #ile separate motions #or
reconsieration. In a Resol$tion
F6G
ate Octo&er 45, 1993, t!e appellate co$rt enie &ot! motions. @na$nte, NSC an VSI #ile
t!eir respecti"e petitions #or re"ie* &e#ore t!is Co$rt. On motion o# VSI, t!e Co$rt orere on Fe&r$ary 12, 1992 t!e consoliation o#
t!ese petitions.
FDG
T>6 Issu6s
In its petition
F1G
an memoran$m,
FBG
NSC raises t!e #ollo*in% ;$estions o# la* an #actH
Fu6st.o$s o/ L#@
(1. :!et!er or not a c!arterer o# a "essel is lia&le #or em$rra%e $e to car%o $nloain% elays ca$se &y *eat!er
interr$ptionJ
4. :!et!er or not t!e alle%e Vsea*ort!iness certi#icates8 <EC!i&its V38, V28, V68, VD8, V18, VB8, V98, V118 an V148= *ere amissi&le in
e"ience an constit$te e"ience o# t!e "essel8s sea*ort!iness at t!e &e%innin% o# t!e "oya%esJ an
3. :!et!er or not a c!arterer8s #ail$re to ins$re its car%o eCempts t!e s!ipo*ner #rom lia&ility #or car%o ama%e.+
Fu6st.o$s o/ !#0t
(1. :!et!er or not t!e "essel *as sea*ort!y an car%oE*ort!yJ
4. :!et!er or not "essel8s o##icers an cre* *ere ne%li%ent in !anlin% an carin% #or NSC8s car%oJ
3. :!et!er or not NSC8s car%o o# tinplates i s*eat $rin% t!e "oya%e an, !ence, r$ste on t!eir o*nJ an
<2= :!et!er or not NSC8s ste"eores *ere ne%li%ent an ca$se t!e *ettin%FIGr$stin% o# NSC8s tinplates.+
In its separate petition,
F9G
VSI s$&mits #or t!e consieration o# t!is Co$rt t!e #ollo*in% alle%e errors o# t!e C.H
(.. T!e responent Co$rt o# .ppeals committe an error o# la* in re$cin% t!e a*ar o# em$rra%e #rom 0BB,555.55 to 022,555.55.
>. T!e responent Co$rt o# .ppeals committe an error o# la* in eletin% t!e a*ar o# 0155,555 #or attorney8s #ees an eCpenses o#
liti%ation.+
.mpli#yin% t!e #ore%oin%, VSI raises t!e #ollo*in% iss$es in its memoran$mH
F15G
(I. :!et!er or not t!e pro"isions o# t!e Ci"il Coe o# t!e 0!ilippines on common carriers p$rs$ant to *!ic! t!ere eCistFsG a pres$mption
o# ne%li%ence a%ainst t!e common carrier in case o# loss or ama%e to t!e car%o are applica&le to a pri"ate carrier.
II. :!et!er or not t!e terms an conitions o# t!e Contract o# Voya%e C!arter ,ire, incl$in% t!e Nanyo/ai C!arter, are "ali an
&inin% on &ot! contractin% parties.+
T!e #ore%oin% iss$es raise &y t!e parties *ill &e isc$sse $ner t!e #ollo*in% !eain%sH
1. T$estions o# Fact
4. E##ect o# NSC8s Fail$re to Ins$re t!e Car%o
3. .missi&ility o# Certi#icates 0ro"in% Sea*ort!iness
2. Dem$rra%e an .ttorney8s Fees.
T>6 Cou,tGs Ru1.$g
T!e Co$rt a##irms t!e assaile Decision o# t!e Co$rt o# .ppeals, eCcept in respect o# t!e em$rra%e.
",61.:.$#,- M#tt6,+ Common Carrier or Private Carrier?
.t t!e o$tset, it is essential to esta&lis! *!et!er VSI contracte *it! NSC as a common carrier or as a pri"ate carrier. T!e
resol$tion o# t!is preliminary ;$estion etermines t!e la*, stanar o# ili%ence an &$ren o# proo# applica&le to t!e present case.
.rticle 1134 o# t!e Ci"il Coe e#ines a common carrier as (persons, corporations, #irms or associations en%a%e in t!e &$siness
o# carryin% or transportin% passen%ers or %oos or &ot!, &y lan, *ater, or air, #or compensation, o##erin% t!eir ser"ices to t!e p$&lic.+ It
!as &een !el t!at t!e tr$e test o# a common carrier is t!e carria%e o# passen%ers or %oos, pro"ie it !as space, #or all *!o opt to
a"ail t!emsel"es o# its transportation ser"ice #or a #ee.
F11G
. carrier *!ic! oes not ;$ali#y $ner t!e a&o"e test is eeme a pri"ate
carrier. (-enerally, pri"ate carria%e is $nerta'en &y special a%reement an t!e carrier oes not !ol !imsel# o$t to carry %oos #or t!e
%eneral p$&lic. T!e most typical, alt!o$%! not t!e only #orm o# pri"ate carria%e, is t!e c!arter party, a maritime contract &y *!ic! t!e
c!arterer, a party ot!er t!an t!e s!ipo*ner, o&tains t!e $se an ser"ice o# all or some part o# a s!ip #or a perio o# time or a "oya%e or
"oya%es.+
F14G
In t!e instant case, it is $nisp$te t!at VSI i not o##er its ser"ices to t!e %eneral p$&lic. .s #o$n &y t!e Re%ional Trial Co$rt, it
carrie passen%ers or %oos only #or t!ose it c!ose $ner a (special contract o# c!arter party.+
F13G
.s correctly concl$e &y t!e Co$rt o#
.ppeals, t!e MV Vlasons % (*as not a common &$t a pri"ate carrier.+
F12G
Conse;$ently, t!e ri%!ts an o&li%ations o# VSI an NSC,
incl$in% t!eir respecti"e lia&ility #or ama%e to t!e car%o, are etermine primarily &y stip$lations in t!eir contract o# pri"ate carria%e or
c!arter party.
F16G
Recently, in Valen/$ela ,ar*oo an In$strial S$pply, Inc., vs. Co$rt o# .ppeals an Se"en >rot!ers S!ippin%
Corporation,
F1DG
t!e Co$rt r$leH
( C C C in a contract o# pri"ate carria%e, t!e parties may #reely stip$late t!eir $ties an o&li%ations *!ic! per#orce *o$l &e &inin% on
t!em. @nli'e in a contract in"ol"in% a common carrier, pri"ate carria%e oes not in"ol"e t!e %eneral p$&lic. ,ence, t!e strin%ent
pro"isions o# t!e Ci"il Coe on common carriers protectin% t!e %eneral p$&lic cannot ?$sti#ia&ly &e applie to a s!ip transportin%
commercial %oos as a pri"ate carrier. Conse;$ently, t!e p$&lic policy em&oie t!erein is not contra"ene &y stip$lations in a c!arter
party t!at lessen or remo"e t!e protection %i"en &y la* in contracts in"ol"in% common carriers.+
F11G
EBt6$t o/ &SIGs R6s2o$s.;.1.t- #$% L.#;.1.t- Ov6, NSCGs C#,go
It is clear #rom t!e parties8 Contract o# Voya%e C!arter ,ire, ate )$ly 11, 1912, t!at VSI (s!all not &e responsi&le #or losses
eCcept on pro"en *ill#$l ne%li%ence o# t!e o##icers o# t!e "essel.+ T!e N.NUOS.I C!arter 0arty, *!ic! *as incorporate in t!e parties8
contract o# transportation, #$rt!er pro"ie t!at t!e s!ipo*ner s!all not &e lia&le #or loss o# or ama%e to t!e car%o arisin% or res$ltin%
#rom $nsea*ort!iness, $nless t!e same *as ca$se &y its lac' o# $e ili%ence to ma'e t!e "essel sea*ort!y or to ens$re t!at t!e
same *as (properly manne, e;$ippe an s$pplie,+ an to (ma'e t!e !ols an all ot!er parts o# t!e "essel in *!ic! car%o F*asG
carrie, #it an sa#e #or its reception, carria%e an preser"ation.+
F1BG
T!e N.NUOS.I C!arter 0arty also pro"ie t!at (FoG*ners s!all not
&e responsi&le #or split, c!a#in% anIor any ama%e $nless ca$se &y t!e ne%li%ence or e#a$lt o# t!e master or cre*.+
F19G
=u,%6$ o/ ",oo/
In "ie* o# t!e a#orementione contract$al stip$lations, NSC m$st pro"e t!at t!e ama%e to its s!ipment *as ca$se &y VSI8s
*ill#$l ne%li%ence or #ail$re to eCercise $e ili%ence in ma'in% MV Vlasons % sea*ort!y an #it #or !olin%, carryin% an sa#e'eepin% t!e
car%o. Inel$cta&ly, t!e &$ren o# proo# *as place on NSC &y t!e parties8 a%reement.
T!is "ie* #ins #$rt!er s$pport in t!e Coe o# Commerce *!ic! pertinently pro"iesH
(.rt. 3D1. Merc!anise s!all &e transporte at t!e ris' an "ent$re o# t!e s!ipper, i# t!e contrary !as not &een eCpressly stip$late.
T!ere#ore, t!e ama%e an impairment s$##ere &y t!e %oos $rin% t!e transportation, $e to #ort$ito$s e"ent, #orce ma?e$re, or t!e
nat$re an in!erent e#ect o# t!e t!in%s, s!all &e #or t!e acco$nt an ris' o# t!e s!ipper.
T!e &$ren o# proo# o# t!ese accients is on t!e carrier.+
(.rt. 3D4. T!e carrier, !o*e"er, s!all &e lia&le #or ama%es arisin% #rom t!e ca$se mentione in t!e precein% article i# proo#s a%ainst
!im s!o* t!at t!ey occ$rre on acco$nt o# !is ne%li%ence or !is omission to ta'e t!e preca$tions $s$ally aopte &y care#$l persons,
$nless t!e s!ipper committe #ra$ in t!e &ill o# lain%, ma'in% !im to &elie"e t!at t!e %oos *ere o# a class or ;$ality i##erent #rom
*!at t!ey really *ere.+
>eca$se t!e MV Vlasons % *as a pri"ate carrier, t!e s!ipo*ner8s o&li%ations are %o"erne &y t!e #ore%oin% pro"isions o# t!e Coe
o# Commerce an not &y t!e Ci"il Coe *!ic!, as a %eneral r$le, places t!e prima facie pres$mption o# ne%li%ence on a common
carrier. It is a !orn&oo' octrine t!atH
(In an action a%ainst a pri"ate carrier #or loss o#, or in?$ry to, car%o, t!e &$ren is on t!e plainti## to pro"e t!at t!e carrier *as ne%li%ent
or $nsea*ort!y, an t!e #act t!at t!e %oos *ere lost or ama%e *!ile in t!e carrier8s c$stoy oes not p$t t!e &$ren o# proo# on t!e
carrier.
Since C C C a pri"ate carrier is not an ins$rer &$t $nerta'es only to eCercise $e care in t!e protection o# t!e %oos committe to its
care, t!e &$ren o# pro"in% ne%li%ence or a &reac! o# t!at $ty rests on plainti## an proo# o# loss o#, or ama%e to, car%o *!ile in t!e
carrier8s possession oes not cast on it t!e &$ren o# pro"in% proper care an ili%ence on its part or t!at t!e loss occ$rre #rom an
eCcepte ca$se in t!e contract or &ill o# lain%. ,o*e"er, in isc!ar%in% t!e &$ren o# proo#, plainti## is entitle to t!e &ene#it o# t!e
pres$mptions an in#erences &y *!ic! t!e la* ais t!e &ailor in an action a%ainst a &ailee, an since t!e carrier is in a &etter position to
'no* t!e ca$se o# t!e loss an t!at it *as not one in"ol"in% its lia&ility, t!e la* re;$ires t!at it come #or*ar *it! t!e in#ormation
a"aila&le to it, an its #ail$re to o so *arrants an in#erence or pres$mption o# its lia&ility. ,o*e"er, s$c! in#erences an pres$mptions,
*!ile t!ey may a##ect t!e &$ren o# comin% #or*ar *it! e"ience, o not alter t!e &$ren o# proo# *!ic! remains on plainti##, an,
*!ere t!e carrier comes #or*ar *it! e"ience eCplainin% t!e loss or ama%e, t!e &$ren o# %oin% #or*ar *it! t!e e"ience is a%ain
on plainti##.
:!ere t!e action is &ase on t!e s!ipo*ner8s *arranty o# sea*ort!iness, t!e &$ren o# pro"in% a &reac! t!ereo# an t!at s$c! &reac!
*as t!e proCimate ca$se o# t!e ama%e rests on plainti##, an proo# t!at t!e %oos *ere lost or ama%e *!ile in t!e carrier8s
possession oes not cast on it t!e &$ren o# pro"in% sea*ort!iness. C C C :!ere t!e contract o# carria%e eCempts t!e carrier #rom
lia&ility #or $nsea*ort!iness not isco"era&le &y $e ili%ence, t!e carrier !as t!e preliminary &$ren o# pro"in% t!e eCercise o# $e
ili%ence to ma'e t!e "essel sea*ort!y.+
F45G
In t!e instant case, t!e Co$rt o# .ppeals correctly #o$n t!at NSC (!as not ta'en t!e correct position in relation to t!e ;$estion o#
*!o !as t!e &$ren o# proo#. T!$s, in its &rie# <pp. 15E11=, a#ter citin% Cla$se 15 an Cla$se 14 o# t!e N.NUOS.I C!arter 0arty
<incientally plainti##Eappellant8s FNSC8sG interpretation o# Cla$se 14 is not e"en correct=, it ar%$es t!at Va care#$l eCamination o# t!e
e"ience *ill s!o* t!at VSI misera&ly #aile to comply *it! any o# t!ese o&li%ations8 as i# e#enantEappellee FVSIG !a t!e &$ren o#
proo#.+
F41G
!.,st Issu6+ Questions of Fact
>ase on t!e #ore%oin%, t!e etermination o# t!e #ollo*in% #act$al ;$estions is mani#estly rele"antH <1= *!et!er VSI eCercise $e
ili%ence in ma'in% MV Vlasons % sea*ort!y #or t!e intene p$rpose $ner t!e c!arter partyJ <4= *!et!er t!e ama%e to t!e car%o
s!o$l &e attri&$te to t!e *ill#$l ne%li%ence o# t!e o##icers an cre* o# t!e "essel or o# t!e ste"eores !ire &y NSCJ an <3= *!et!er
t!e r$stin% o# t!e tinplates *as ca$se &y its o*n (s*eat+ or &y contact *it! sea*ater.
T!ese ;$estions o# #act *ere t!res!e o$t an ecie &y t!e trial co$rt, *!ic! !a t!e #irst!an opport$nity to !ear t!e parties8
con#lictin% claims an to care#$lly *ei%! t!eir respecti"e e"ience. T!e #inin%s o# t!e trial co$rt *ere s$&se;$ently a##irme &y t!e
Co$rt o# .ppeals. :!ere t!e #act$al #inin%s o# &ot! t!e trial co$rt an t!e Co$rt o# .ppeals coincie, t!e same are &inin% on t!is
Co$rt.
F44G
:e stress t!at, s$&?ect to some eCceptional instances,
F43G
only ;$estions o# la* EE not ;$estions o# #act EE may &e raise &e#ore
t!is Co$rt in a petition #or re"ie* $ner R$le 26 o# t!e R$les o# Co$rt. .#ter a t!oro$%! re"ie* o# t!e case at &ar, *e #in no reason to
ist$r& t!e lo*er co$rts8 #act$al #inin%s, as inee NSC !as not s$ccess#$lly pro"en t!e application o# any o# t!e a#orecite eCceptions.
Was M& &1#so$s I Seaorth!?
In any e"ent, t!e recors re"eal t!at VSI eCercise $e ili%ence to ma'e t!e s!ip sea*ort!y an #it #or t!e carria%e o# NSC8s
car%o o# steel an tinplates. T!is is s!o*n &y t!e #act t!at it *as ryoc'e an inspecte &y t!e 0!ilippine Coast -$ar &e#ore it
proceee to Ili%an City #or its "oya%e to Manila $ner t!e contract o# "oya%e c!arter !ire.
F42G
T!e "essel8s "oya%e #rom Ili%an to Manila
*as t!e "essel8s first vo"age after dr"doc:ing. T!e 0!ilippine Coast -$ar Station in Ce&$ cleare it as sea$orth", fitted
and e8uipped! it met all re8uirements for trading as cargo vessel.
F46G
T!e Co$rt o# .ppeals itsel# s$staine t!e concl$sion o# t!e trial
co$rt t!at MV Vlasons % *as sea*ort!y. :e #in no reason to moi#y or re"erse t!is #inin% o# &ot! t!e trial an t!e appellate co$rts.
3>o 36,6 N6g1.g6$t+ S6#:6$ o, St6v6%o,6sC
.s note earlier, t!e NSC !a t!e &$ren o# pro"in% t!at t!e ama%e to t!e car%o *as ca$se &y t!e ne%li%ence o# t!e o##icers
an t!e cre* o# MV Vlasons % in ma'in% t!eir "essel sea*ort!y an #it #or t!e carria%e o# tinplates. NSC #aile to isc!ar%e t!is &$ren.
>e#ore $s, NSC relies !ea"ily on its claim t!at MV Vlasons % !a $se an ol an torn tarpa$lin or can"as to co"er t!e !atc!es
t!ro$%! *!ic! t!e car%o *as loae into t!e car%o !ol o# t!e s!ip. It #a$lts t!e Co$rt o# .ppeals #or #ailin% to consier s$c! claim as
an ($ncontro"erte #act+
F4DG
an enies t!at MV Vlasons % (*as e;$ippe *it! ne* can"as co"ers in tanem *it! t!e ol ones as
inicate in t!e Marine 0rotest CCC.+
F41G
:e isa%ree.
T!e recors s$##iciently s$pport VSI8s contention t!at t!e s!ip $se t!e ol tarpa$lin, only in aition to t!e ne*
one $se primarily to ma'e t!e s!ip8s !atc!es *aterti%!t. T!e #ore%oin% are clear #rom t!e marine protest o# t!e master o# t!eMV
Vlasons %, .ntonio C. D$mlao, an t!e eposition o# t!e s!ip8s &oats*ain, )ose 0asc$a. T!e salient portions o# sai marine protest
reaH
(C C C T!at t!e MIV (VL.SONS I+ eparte Ili%an City or or a&o$t 5135 !o$rs o# .$%$st B, 1912, loae *it! approCimately 4,2B1.9
tons o# steel plates an tin plates consi%ne to National Steel CorporationJ t!at &e#ore epart$re, t!e "essel *as ri%%e, #$lly e;$ippe
an cleare &y t!e a$t!oritiesJ t!at on or a&o$t .$%$st 9, 1912, *!ile in t!e "icinity o# t!e *estern part o# Ne%ros an 0anay, *e
enco$ntere "ery ro$%! seas an stron% *ins an Manila o##ice *as a"ise &y tele%ram o# t!e a"erse *eat!er conitions
enco$ntereJ t!at in t!e mornin% o# .$%$st 15, 1912, t!e *eat!er conition c!an%e to *orse an stron% *ins an &i% *a"es
contin$e po$nin% t!e "essel at !er port sie ca$sin% sea *ater to o"er#lo* on ec' an!atc! <sic= co"ers an *!ic! ca$se t!e #irst
layer o# t!e can"ass co"erin% to %i"e *ay *!ile t!e ne* can"ass co"erin% still !olin% onJ
T!at t!e *eat!er conition impro"e *!en *e reac!e D$mali 0oint protecte &y MinoroJ t!at *e reEsec$re t!e can"ass co"erin%
&ac' to positionJ t!at in t!e a#ternoon o# .$%$st 15, 1912, *!ile enterin% Marica&an 0assa%e, *e *ere a%ain eCpose to moerate seas
an !ea"y rainsJ t!at *!ile approac!in% Fort$ne Islan, *e enco$ntere a%ain ro$%! seas, stron% *ins an &i% *a"es *!ic! ca$se
t!e same can"ass to %i"e *ay an lea"in% t!e ne* can"ass !olin% onJ
CCC CCC CCC+
F4BG
.n t!e rele"ant portions o# )ose 0asc$a8s eposition are as #ollo*sH
(TH :!at is t!e p$rpose o# t!e can"as co"erL
.H So t!at t!e car%o *o$l not &e soa'e *it! *ater.
.H .n *ill yo$ escri&e !o* t!e can"as co"er *as sec$re on t!e !atc! openin%L
:ITNESS
.H It *as place #lat on top o# t!e !atc! co"er, *it! a little can"as #lo*in% o"er t!e sies an *e placeFG a #lat &ar o"er t!e
can"as on t!e sie o# t!e !atc!es an t!en *e placeFG a stopper so t!at t!e can"as co$l not &e remo"e.
.TTU DEL ROS.RIO
TH .n *ill yo$ tell $s t!e si/e o# t!e !atc! openin%L T!e len%t! an t!e *it! o# t!e !atc! openin%.
.H FortyE#i"e #eet &y t!irtyE#i"e #eet, sir.
C C C C C C C C C
TH ,o* *as t!e can"as s$pporte in t!e mile o# t!e !atc! openin%L
.H T!ere is a !atc! &oar.
.TTU DEL ROS.RIO
TH :!at is t!e !atc! &oar mae o#L
.H It is mae o# *oo, *it! a !anle.
TH .n asie #rom t!e !atc! &oar, is t!ere any ot!er material t!ere to co"er t!e !atc!L
.H T!ere is a &eam s$pportin% t!e !atc! &oar.
TH :!at is t!is &eam mae o#L
.H It is mae o# steel, sir.
TH Is t!e &eam t!at *as place in t!e !atc! openin% co"erin% t!e *!ole !atc! openin%L
.H No, sir.
TH ,o* many !atc! &eams *ere t!ere place across t!e openin%L
.H T!ere are #i"e &eams in one !atc! openin%.
.TTU DEL ROS.RIO
TH .n on top o# t!e &eams yo$ sai t!ere is a !atc! &oar. ,o* many pieces o# *oo are p$t on topL
.H 0lenty, sir, &eca$se t!ere are se"eral pieces on top o# t!e !atc! &eam.
TH .n is t!ere a space &et*een t!e !atc! &oarsL
.H T!ere is none, sir.
TH T!ey are ti%!t to%et!erL
.H Ues, sir.
TH ,o* ti%!tL
.H Very ti%!t, sir.
TH No*, on top o# t!e !atc! &oars, accorin% to yo$, is t!e can"as co"er. ,o* many can"as co"ersL
.H T*o, sir.+
F49G
T!at $e ili%ence *as eCercise &y t!e o##icers an t!e cre* o# t!e MV Vlasons % *as #$rt!er emonstrate &y t!e #act t!at,
espite enco$nterin% ro$%! *eat!er t*ice, t!e ne* tarpa$lin i not %i"e *ay an t!e s!ip8s !atc!es an car%o !ols remaine
*aterproo#. .s aptly state &y t!e Co$rt o# .ppeals, (CCC *e #in no reason not to s$stain t!e concl$sion o# t!e lo*er co$rt &ase on
o"er*!elmin% e"ience, t!at t!e MV VVL.SONS I8 *as sea*ort!y *!en it $nertoo' t!e "oya%e on .$%$st B, 1912 carryin% on &oar
t!ereo# plainti##Eappellant8s s!ipment o# 1,D11 s'is o# tinplates an 94 pac'a%es o# !ot rolle s!eets or a total o# 1,1D9 pac'a%es #rom
NSC8s pier in Ili%an City arri"in% sa#ely at Nort! ,ar&or, 0ort .rea, Manila, on .$%$st 14, 1912J CCC.+
F35G
Inee, NSC #aile to isc!ar%e its &$ren to s!o* ne%li%ence on t!e part o# t!e o##icers an t!e cre* o# MV Vlasons %. On t!e
contrary, t!e recors re"eal t!at it *as t!e ste"eores o# NSC *!o *ere ne%li%ent in $nloain% t!e car%o #rom t!e s!ip.
T!e ste"eores employe only a tentEli'e material to co"er t!e !atc!es *!en stron% rains occasione &y a passin% typ!oon
isr$pte t!e $nloain% o# t!e car%o. T!is tentEli'e co"erin%, !o*e"er, *as clearly inae;$ate #or 'eepin% rain an sea*ater a*ay #rom
t!e !atc!es o# t!e s!ip. Vicente .n%lion%to, an o##icer o# VSI, testi#ie t!$sH
(.TTU S.MOR.H
TH No*, $rin% yo$r testimony on No"em&er 6, 1919, yo$ state on .$%$st 12 yo$ *ent on &oar t!e "essel $pon notice
#rom t!e National Steel Corporation in orer to con$ct t!e inspection o# t!e car%o. D$rin% t!e co$rse o# t!e
in"esti%ation, i yo$ c!ance to see t!e isc!ar%in% operationL
:ITNESSH
.H Ues, sir, $pon my arri"al at t!e "essel, I sa* some o# t!e tinplates alreay isc!ar%e on t!e pier &$t ma?ority o# t!e
tinplates *ere insie t!e !all, all t!e !atc!es *ere opene.
TH In connection *it! t!ese car%oes *!ic! *ere $nloae, *!ere is t!e place.
.H .t t!e 0ier.
TH :!at *as $se to protect t!e same #rom *eat!erL
.TTU LO0ESH
:e o&?ect, yo$r ,onor, t!is ;$estion *as alreay as'e. T!is partic$lar matter . . . t!e transcript o# steno%rap!ic notes
s!o*s t!e same *as co"ere in t!e irect eCamination.
.TTU S.MOR.H
0recisely, yo$r ,onor, *e *o$l li'e to %o on etail, t!is is t!e serio$s part o# t!e testimony.
CO@RTH
.ll ri%!t, *itness may ans*er.
.TTU LO0ESH
TH :!at *as $se in orer to protect t!e car%o #rom t!e *eat!erL
.H . &ase o# can"as *as $se as co"er on top o# t!e tin plates, an tents *ere &$ilt at t!e openin% o# t!e !atc!es.
TH Uo$ also state t!at t!e !atc!es *ere alreay opene an t!at t!ere *ere tents constr$cte at t!e openin% o# t!e
!atc!es to protect t!e car%o #rom t!e rain. No*, *ill yo$ escri&e FtoG t!e Co$rt t!e tents constr$cte.
.H T!e tents are ?$st a &ase o# can"as *!ic! loo' li'e a tent o# an Inian camp raiseFG !i%! at t!e mile *it! t!e *!ole
sie separate o*n to t!e !atc!, t!e si/e o# t!e !atc! an it is soa's FsicG at t!e mile &eca$se o# t!ose *eat!er an
t!is can &e $se only to temporarily protect t!e car%o #rom %ettin% *et &y rains.
TH No*, is t!is proce$re aopte &y t!e ste"eores o# co"erin% tents properL
.H No, sir, at t!e time t!ey *ere isc!ar%in% t!e car%o, t!ere *as a typ!oon passin% &y an t!e !atc! tent *as not %oo
eno$%! to !ol all o# it to pre"ent t!e *ater soa'in% t!ro$%! t!e can"as an enter t!e car%o.
TH In t!e co$rse o# yo$r inspection, Mr. .n%lin%to FsicG, i yo$ see in #act t!e *ater enter an soa' into t!e can"as an
tinplates.
.H Ues, sir, t!e secon time I *ent t!ere, I sa* it.
TH .s o*ner o# t!e "essel, i yo$ not a"ise t!e National Steel Corporation Fo#G t!e proce$re aopte &y its ste"eores in
isc!ar%in% t!e car%o partic$larly in t!is tent co"erin% o# t!e !atc!esL
.H Ues, sir, I i t!e #irst time I sa* it, I calle t!e attention o# t!e ste"eores &$t t!e ste"eores i not min at all, so, I
calle t!e attention o# t!e representati"e o# t!e National Steel &$t not!in% *as one, ?$st t!e same. Finally, I *rote a
letter to t!em.+
F31G
NSC attempts to iscreit t!e testimony o# .n%lion%to &y ;$estionin% !is #ail$re to complain immeiately a&o$t t!e ste"eores8
ne%li%ence on t!e #irst ay o# $nloain%, pointin% o$t t!at !e *rote !is letter to petitioner only se"en ays later.
F34G
T!e Co$rt is not
pers$ae. .n%lion%to8s cani ans*er in !is a#ore;$ote testimony satis#actorily eCplaine t!e elay. Se"en ays lapse &eca$se !e
#irst calle t!e attention o# t!e ste"eores, t!en t!e NSC8s representati"e, a&o$t t!e ne%li%ent an e#ecti"e proce$re aopte in
$nloain% t!e car%o. T!is series o# actions constit$tes a reasona&le response in accor *it! common sense an orinary !$man
eCperience. Vicente .n%lion%to co$l not &e &lame #or callin% t!e ste"eores8 attention #irst an t!en t!e NSC8s representati"e on
location &e#ore #ormally in#ormin% NSC o# t!e ne%li%ence !e !a o&ser"e, &eca$se !e *as not responsi&le #or t!e ste"eores or t!e
$nloain% operations. In #act, !e *as merely eCpressin% concern #or NSC *!ic! *as $ltimately responsi&le #or t!e ste"eores it !a
!ire an t!e per#ormance o# t!eir tas' to $nloa t!e car%o.
:e see no reason to re"erse t!e trial an t!e appellate co$rts8 #inin%s an concl$sions on t!is point, vizH
(In t!e T,IRD assi%ne error, FNSCG claims t!at t!e trial co$rt erre in #inin% t!at t!e ste"eores !ire &y NSC *ere ne%li%ent in t!e
$nloain% o# NSC8s s!ipment. :e o not t!in' so. S$c! ne%li%ence accorin% to t!e trial co$rt is e"ient in t!e ste"eores !ire &y
FNSCG, not closin% t!e !atc! o# MV VVL.SONS I8 *!en rains occ$rre $rin% t!e isc!ar%in% o# t!e car%o t!$s allo*in% rain *ater an
sea*ater spray to enter t!e !atc!es an to ri#t to an #all on t!e car%o. It *as pro"en t!at t!e ste"eores merely set $p temporary
tents or can"as to co"er t!e !atc! openin%s *!en it raine $rin% t!e $nloain% operations so t!at it *o$l &e easier #or t!em to
res$me *or' a#ter t!e rains stoppe &y ?$st remo"in% sai tents or can"ass. It !as also &een s!o*n t!at on .$%$st 45, 1912, VSI
0resient Vicente .n%lion%to *rote FNSCG callin% attention to t!e manner t!e ste"eores !ire &y FNSCG *ere isc!ar%in% t!e car%o on
rainy ays an t!e improper closin% o# t!e !atc!es *!ic! allo*e contin$o$s !ea"y rain *ater to lea' t!ro$%! an rip to t!e tinplates8
co"ers an FVicente .n%lion%toG also s$%%estin% t!at $e to #o$r <2= ays contin$os rains *it! stron% *ins t!at t!e !atc!es &e totally
close o*n an co"ere *it! can"as an t!e !atc! tents lo*ere. <EC! V138=. T!is letter *as recei"e &y FNSCG on 44 .$%$st 1912
*!ile isc!ar%in% operations *ere still %oin% on <EC!i&it V13E.8=.+
F33G
T!e #act t!at NSC act$ally accepte an proceee to remo"e t!e car%o #rom t!e s!ip $rin% $n#a"ora&le *eat!er *ill not ma'e
VSI lia&le #or any ama%e ca$se t!ere&y. In passin%, it may &e note t!at t!e NSC may see' inemni#ication, s$&?ect to t!e la*s on
prescription, #rom t!e ste"eorin% company at #a$lt in t!e isc!ar%e operations. (. ste"eore company en%a%e in isc!ar%in% car%o
CCC !as t!e $ty to loa t!e car%o CCC in a pr$ent manner, an it is lia&le #or in?$ry to, or loss o#, car%o ca$se &y its ne%li%ence CCC
an *!ere t!e o##icers an mem&ers an cre* o# t!e "essel o not!in% an !a"e no responsi&ility in t!e isc!ar%e o# car%o &y
ste"eores CCC t!e "essel is not lia&le #or loss o#, or ama%e to, t!e car%o ca$se &y t!e ne%li%ence o# t!e ste"eores CCC+
F32G
as in
t!e instant case.
(o T.$21#t6s ES@6#tHC
T!e trial co$rt relie on t!e testimony o# Vicente .n%lion%to in #inin% t!at ( CCC tinplates Vs*eat8 &y t!emsel"es *!en pac'e e"en
*it!o$t &ein% in contact *it! *ater #rom o$tsie especially *!en t!e *eat!er is &a or rainin% CCC.+
F36G
T!e Co$rt o# .ppeals a##irme
t!e trial co$rt8s #inin%.
. isc$ssion o# t!is iss$e appears inconse;$ential an $nnecessary. .s pre"io$sly isc$sse, t!e ama%e to t!e tinplates *as
occasione not &y air&orne moist$re &$t &y contact *it! rain an sea*ater *!ic! t!e ste"eores ne%li%ently allo*e to seep in $rin%
t!e $nloain%.
S60o$% Issu6+ "ffect of #SC$s Failure to %nsure the Cargo
T!e o&li%ation o# NSC to ins$re t!e car%o stip$late in t!e Contract o# Voya%e C!arter ,ire is totally separate an istinct #rom t!e
contract$al or stat$tory responsi&ility t!at may &e inc$rre &y VSI #or ama%e to t!e car%o ca$se &y t!e *ill#$l ne%li%ence o# t!e
o##icers an t!e cre* o# MV Vlasons %. Clearly, t!ere#ore, NSC8s #ail$re to ins$re t!e car%o *ill not a##ect its ri%!t, as o*ner an real
party in interest, to #ile an action a%ainst VSI #or ama%es ca$se &y t!e latter8s *ill#$l ne%li%ence. :e o not #in anyt!in% in t!e
c!arter party t!at *o$l ma'e t!e lia&ility o# VSI #or ama%e to t!e car%o contin%ent on or a##ecte in any manner &y NSC8s o&tainin%
an ins$rance o"er t!e car%o.
T>.,% Issu6+ &dmissibilit! of Certificates Proving Seaorthiness
NSC8s contention t!at MV Vlasons % *as not sea*ort!y is anc!ore on t!e alle%e inamissi&ility o# t!e certi#icates o#
sea*ort!iness o##ere in e"ience &y VSI. T!e sai certi#icates incl$e t!e #ollo*in%H
1. Certi#icate o# Inspection o# t!e 0!ilippine Coast -$ar at Ce&$
4. Certi#icate o# Inspection #rom t!e 0!ilippine Coast -$ar
3. International Loa Line Certi#icate #rom t!e 0!ilippine Coast -$ar
2. Coast*ise License #rom t!e >oar o# Transportation
6. Certi#icate o# .ppro"al #or Con"ersion iss$e &y t!e >$rea$ o# C$stoms.
F3DG
NSC ar%$es t!at t!e certi#icates are !earsay #or not !a"in% &een presente in accorance *it! t!e R$les o# Co$rt. It points o$t
t!at EC!i&its 3, 2 an 11 alle%ely are (not *ritten recors or acts o# p$&lic o##icers+J *!ile EC!i&its 6, D, 1, B, 9, 11 an 14 are not
(e"ience &y o##icial p$&lications or certi#ie tr$e copies+ as re;$ire &y Sections 46 an 4D, R$le 134, o# t!e R$les o# Co$rt.
F31G
.#ter a care#$l eCamination o# t!ese eC!i&its, t!e Co$rt r$les t!at EC!i&its 3, 2, 6, D, 1, B, 9 an 14 are inamissi&le, #or t!ey !a"e
not &een properly o##ere as e"ience. EC!i&its 3 an 2 are certi#icates iss$e &y pri"ate parties, &$t t!ey !a"e not &een pro"en &y one
*!o sa* t!e *ritin% eCec$te, or &y e"ience o# t!e %en$ineness o# t!e !an*ritin% o# t!e ma'er, or &y a s$&scri&in% *itness. EC!i&its
6, D, 1, B, 9, an 14 are p!otocopies, &$t t!eir amission $ner t!e &est e"ience r$le !a"e not &een emonstrate.
:e #in, !o*e"er, t!at EC!i&it 11 is amissi&le $ner a *ellEsettle eCception to t!e !earsay r$le per Section 22 o# R$le 135 o# t!e
R$les o# Co$rt, *!ic! pro"ies t!at (<e=ntries in o##icial recors mae in t!e per#ormance o# a $ty &y a p$&lic o##icer o# t!e 0!ilippines,
or &y a person in t!e per#ormance o# a $ty specially en?oine &y la*, are prima facie e"ience o# t!e #acts t!erein state.+
F3BG
EC!i&it 11
is an ori%inal certi#icate o# t!e 0!ilippine Coast -$ar in Ce&$ iss$e &y Lie$tenant )$nior -rae Noli C. Flores to t!e e##ect t!at (t!e
"essel VVL.SONS I8 *as ryoc'e C C C an 0C- Inspectors *ere sent on &oar #or inspection C C C. .#ter completion o# ryoc'in%
an $ly inspecte &y 0C- Inspectors, t!e "essel VVL.SONS I8, a car%o "essel, is in sea*ort!y conition, meets all re;$irements, #itte
an e;$ippe #or train% as a car%o "essel *as cleare &y t!e 0!ilippine Coast -$ar an saile #or Ce&$ 0ort on )$ly 15, 1912.+
<sic= NSC8s claim, t!ere#ore, is o&"io$sly misleain% an erroneo$s.
.t any rate, it s!o$l &e stresse t!at t!at NSC !as t!e &$ren o# pro"in% t!at MV Vlasons % *as not sea*ort!y. .s o&ser"e
earlier, t!e "essel *as a pri"ate carrier an, as s$c!, it i not !a"e t!e o&li%ation o# a common carrier to s!o* t!at it *as
sea*ort!y. Inee, NSC %larin%ly #aile to isc!ar%e its $ty o# pro"in% t!e *ill#$l ne%li%ence o# VSI in ma'in% t!e s!ip sea*ort!y
res$ltin% in ama%e to its car%o. .ssailin% t!e %en$ineness o# t!e certi#icate o# sea*ort!iness is not s$##icient proo# t!at t!e "essel *as
not sea*ort!y.
!ou,t> Issu6+ 'emurrage and &ttorne!$s Fees
T!e contract o# "oya%e c!arter !ire pro"ies inter aliaH
CCC CCC CCC
4. Car%oH F$ll car%o o# steel pro$cts o# not less t!an 4,655 MT, 157 more or less at Master8s option.
CCC CCC CCC
D. Loain%IDisc!ar%in% Rate H 165 tons per ::DS,INC.
1. Dem$rra%eIDispatc! H 0B,555.55I02,555.55 per ay.+
F39G
T!e Co$rt e#ine em$rra%e in its strict sense as t!e compensation pro"ie #or in t!e contract o# a##rei%!tment #or t!e etention
o# t!e "essel &eyon t!e laytime or t!at perio o# time a%ree on #or loain% an $nloain% o# car%o.
F25G
It is %i"en to compensate t!e
s!ipo*ner #or t!e non$se o# t!e "essel. On t!e ot!er !an, t!e #ollo*in% is *ellEsettleH
(Laytime r$ns accorin% to t!e partic$lar cla$se o# t!e c!arter party. C C C I# laytime is eCpresse in Vr$nnin% ays,8 t!is means ays
*!en t!e s!ip *o$l &e r$n contin$o$sly, an !oliays are not eCcepte. . ;$ali#ication o# V*eat!er permittin%8 eCcepts only t!ose ays
*!en &a *eat!er reasona&ly pre"ents t!e *or' contemplate.+
F21G
In t!is case, t!e contract o# "oya%e c!arter !ire pro"ie #or a #o$rEay laytimeJ it also ;$ali#ie laytime as ::DS,INC or *eat!er
*or'in% ays S$nays an !oliays incl$e.
F24G
T!e r$nnin% o# laytime *as t!$s mae s$&?ect to t!e *eat!er, an *o$l cease to r$n
in t!e e"ent $n#a"ora&le *eat!er inter#ere *it! t!e $nloain% o# car%o.
F23G
Conse;$ently, NSC may not &e !el lia&le #or em$rra%e as
t!e #o$rEay laytime allo*e it i not lapse, !a"in% &een tolle &y $n#a"ora&le *eat!er conition in "ie* o# t!e ::DS,INC
;$ali#ication a%ree $pon &y t!e parties. Clearly, it *as error #or t!e trial co$rt an t!e Co$rt o# .ppeals to !a"e #o$n an a##irme
respecti"ely t!at NSC inc$rre ele"en ays o# elay in $nloain% t!e car%o. T!e trial co$rt arri"e at t!is erroneo$s #inin% &y
s$&tractin% #rom t!e t*el"e ays, speci#ically .$%$st 13, 1912 to .$%$st 42, 1912, t!e only ay o# $nloain% $n!ampere &y
$n#a"ora&le *eat!er or rain *!ic! *as .$%$st 44, 1912. >ase on o$r pre"io$s isc$ssion, s$c! #inin% is a re"ersi&le error. .s
mentione, t!e responent appellate co$rt also erre in r$lin% t!at NSC *as lia&le to VSI #or em$rra%e, e"en i# it re$ce t!e amo$nt
&y !al#.
Atto,$6-Gs !66s
VSI assi%ns as error o# la* t!e Co$rt o# .ppeals8 eletion o# t!e a*ar o# attorney8s #ees. :e isa%ree. :!ile VSI *as compelle
to liti%ate to protect its ri%!ts, s$c! #act &y itsel# *ill not ?$sti#y an a*ar o# attorney8s #ees $ner .rticle 445B o# t!e Ci"il Coe *!en ( C C
C no s$##icient s!o*in% o# &a #ait! *o$l &e re#lecte in a party8s persistence in a case ot!er t!an an erroneo$s con"iction o# t!e
ri%!teo$sness o# !is ca$se C C C.+
F22G
Moreo"er, attorney8s #ees may not &e a*are to a party #or t!e reason alone t!at t!e ?$%ment
renere *as #a"ora&le to t!e latter, as t!is is tantamo$nt to imposin% a premi$m on one8s ri%!t to liti%ate or see' ?$icial reress o#
le%itimate %rie"ances.
F26G
E2.1ogu6
.t &ottom, t!is appeal really !in%es on a #act$al iss$eH *!en, !o* an *!o ca$se t!e ama%e to t!e car%oL Ran%e a%ainst
NSC are t*o #ormia&le tr$t!s. First, &ot! lo*er co$rts #o$n t!at s$c! ama%e *as &ro$%!t a&o$t $rin% t!e $nloain% process *!en
rain an sea*ater seepe t!ro$%! t!e car%o $e to t!e #a$lt or ne%li%ence o# t!e ste"eores employe &y it. >asic is t!e r$le t!at
#act$al #inin%s o# t!e trial co$rt, *!en a##irme &y t!e Co$rt o# .ppeals, are &inin% on t!e S$preme Co$rt. .lt!o$%! t!ere are settle
eCceptions, NSC !as not satis#actorily s!o*n t!at t!is case is one o# t!em. Secon, t!e a%reement &et*een t!e parties EE t!e Contract
o# Voya%e C!arter ,ire EE place t!e &$ren o# proo# #or s$c! loss or ama%e $pon t!e s!ipper, not $pon t!e s!ipo*ner. S$c!
stip$lation, *!ile isa"anta%eo$s to NSC, is "ali &eca$se t!e parties entere into a contract o# pri"ate c!arter, not one o# common
carria%e. >asic too is t!e octrine t!at co$rts cannot relie"e a party #rom t!e e##ects o# a pri"ate contract #reely entere into, on t!e
%ro$n t!at it is alle%ely oneEsie or $n#air to t!e plainti##. T!e c!arter party is a normal commercial contract an its stip$lations are
a%ree $pon in consieration o# many #actors, not t!e least o# *!ic! is t!e transport price *!ic! is etermine not only &y t!e act$al
costs &$t also &y t!e ris's an &$rens ass$me &y t!e s!ipper in re%ar to possi&le loss or ama%e to t!e car%o. In reco%nition o#
s$c! #actors, t!e parties e"en stip$late t!at t!e s!ipper s!o$l ins$re t!e car%o to protect itsel# #rom t!e ris's it $nertoo' $ner t!e
c!arter party. T!at NSC #aile or ne%lecte to protect itsel# *it! s$c! ins$rance s!o$l not a"ersely a##ect VSI, *!ic! !a not!in% to
o *it! s$c! #ail$re or ne%lect.
3HERE!ORE, premises consiere, t!e instant consoliate petitions are !ere&y DENIED. T!e ;$estione Decision o# t!e
Co$rt o# .ppeals is .FFIRMED *it! t!e MODIFIC.TION t!at t!e em$rra%e a*are to VSI is elete. No prono$ncement as to
costs.
SO OR(ERE(.
.arvasa, C.J., <Chairman=, 1omero, Melo, an ,rancisco, JJ., conc$r.
G.R. No. 159719 August 27, 2012
S"OSES TEO(ORO
1
#$% NANETTE "ERENA, 0etitioners,
"s.
S"OSES TERESITA "HILI""INE NICOLAS #$% L. 8ARATE, NATIONAL RAIL3A)S, #$% t>6 CORT O!
A""EALS Responents.
D E C I S I O N
=ERSAMIN, J.:
T!e operator o# a. sc!ool &$s ser"ice is a common carrier in t!e eyes o# t!e la*. ,e is &o$n to o&ser"e eCtraorinary ili%ence in t!e
con$ct o# !is &$siness. ,e is pres$me to &e ne%li%ent *!en eat! occ$rs to a passen%er. ,is lia&ility may incl$e inemnity #or loss
o# earnin% capacity e"en i# t!e ecease passen%er may only &e an $nemploye !i%! sc!ool st$ent at t!e time o# t!e accient.
T>6 C#s6
>y petition #or re"ie* on certiorari, Spo$ses Teooro an Nanette 0ere#ia <0ere#ias= appeal t!e a"erse ecision prom$l%ate on
No"em&er 13, 4554, &y *!ic! t!e Co$rt o# .ppeals <C.= a##irme *it! moi#ication t!e ecision renere on Decem&er 3, 1999 &y t!e
Re%ional Trial Co$rt <RTC=, >ranc! 4D5, in 0araYa;$e City t!at !a ecree t!em ?ointly an se"erally lia&le *it! 0!ilippine National
Rail*ays <0NR=, t!eir coEe#enant, to Spo$ses Nicolas an Teresita Sarate <Sarates= #or t!e eat! o# t!eir 16Eyear ol son, .aron
)o!n L. Sarate <.aron=, t!en a !i%! sc!ool st$ent o# Don >osco Tec!nical Instit$te <Don >osco=.
A$t606%6$ts
T!e 0ereYas *ere en%a%e in t!e &$siness o# transportin% st$ents #rom t!eir respecti"e resiences in 0araYa;$e City to Don >osco
in 0ason% Tamo, Ma'ati City, an &ac'. In t!eir &$siness, t!e 0ereYas $se a XI. Ceres Van <"an= *it! 0late No. 0U. B9D, *!ic! !a
t!e capacity to transport 12 st$ents at a time, t*o o# *!om *o$l &e seate in t!e #ront &esie t!e ri"er, an t!e ot!ers in t!e rear,
*it! siC st$ents on eit!er sie. T!ey employe Clemente .l#aro <.l#aro= as ri"er o# t!e "an.
In )$ne 199D, t!e Sarates contracte t!e 0ereYas to transport .aron to an #rom Don >osco. On .$%$st 44, 199D, as on pre"io$s
sc!ool ays, t!e "an pic'e .aron $p aro$n DH55 a.m. #rom t!e Sarates8 resience. .aron too' !is place on t!e le#t sie o# t!e "an
near t!e rear oor. T!e "an, *it! its airEconitionin% $nit t$rne on an t!e stereo playin% lo$ly, $ltimately carrie all t!e 12 st$ent
riers on t!eir *ay to Don >osco. Consierin% t!at t!e st$ents *ere $e at Don >osco &y 1H16 a.m., an t!at t!ey *ere alreay
r$nnin% late &eca$se o# t!e !ea"y "e!ic$lar tra##ic on t!e So$t! S$per!i%!*ay, .l#aro too' t!e "an to an alternate ro$te at a&o$t DH26
a.m. &y tra"ersin% t!e narro* pat! $nerneat! t!e Ma%allanes Interc!an%e t!at *as t!en commonly $se &y Ma'atiE&o$n "e!icles as
a s!ort c$t into Ma'ati. .t t!e time, t!e narro* pat! *as mar'e &y piles o# constr$ction materials an par'e passen%er ?eepneys, an
t!e railroa crossin% in t!e narro* pat! !a no railroa *arnin% si%ns, or *atc!men, or ot!er responsi&le persons mannin% t!e
crossin%. In #act, t!e &am&oo &aranilla *as $p, lea"in% t!e railroa crossin% open to tra"ersin% motorists.
.t a&o$t t!e time t!e "an *as to tra"erse t!e railroa crossin%, 0NR Comm$ter No. 354 <train=, operate &y )!onny .lano <.lano=, *as
in t!e "icinity o# t!e Ma%allanes Interc!an%e tra"ellin% nort!&o$n. .s t!e train neare t!e railroa crossin%, .l#aro ro"e t!e "an
east*ar across t!e railroa trac's, closely tailin% a lar%e passen%er &$s. ,is "ie* o# t!e oncomin% train *as &loc'e &eca$se !e
o"ertoo' t!e passen%er &$s on its le#t sie. T!e train &le* its !orn to *arn motorists o# its approac!. :!en t!e train *as a&o$t 65
meters a*ay #rom t!e passen%er &$s an t!e "an, .lano applie t!e orinary &ra'es o# t!e train. ,e applie t!e emer%ency &ra'es
only *!en !e sa* t!at a collision *as imminent. T!e passen%er &$s s$ccess#$lly crosse t!e railroa trac's, &$t t!e "an ri"en &y
.l#aro i not. T!e train !it t!e rear en o# t!e "an, an t!e impact t!re* nine o# t!e 14 st$ents in t!e rear, incl$in% .aron, o$t o# t!e
"an. .aron lane in t!e pat! o# t!e train, *!ic! ra%%e !is &oy an se"ere !is !ea, instantaneo$sly 'illin% !im. .lano #le t!e
scene on &oar t!e train, an i not *ait #or t!e police in"esti%ator to arri"e.
De"astate &y t!e early an $neCpecte eat! o# .aron, t!e Sarates commence t!is action #or ama%es a%ainst .l#aro, t!e 0ereYas,
0NR an .lano. T!e 0ereYas an 0NR #ile t!eir respecti"e ans*ers, *it! crossEclaims a%ainst eac! ot!er, &$t .l#aro co$l not &e
ser"e *it! s$mmons.
.t t!e preEtrial, t!e parties stip$late on t!e #acts an iss$es, "i/H
.. F.CTSH
<1=) T!at spo$ses Sarate *ere t!e le%itimate parents o# .aron )o!n L. SarateJ
<4=) Spo$ses Sarate en%a%e t!e ser"ices o# spo$ses 0ereYa #or t!e ae;$ate an sa#e transportation carria%e o# t!e #ormer
spo$sesR son #rom t!eir resience in 0araYa;$e to !is sc!ool at t!e Don >osco Tec!nical Instit$te in Ma'ati CityJ
<3=) D$rin% t!e e##ecti"ity o# t!e contract o# carria%e an in t!e implementation t!ereo#, .aron, t!e minor son o# spo$ses Sarate
ie in connection *it! a "e!ic$larItrain collision *!ic! occ$rre *!ile .aron *as riin% t!e contracte carrier Xia Ceres "an o#
spo$ses 0ereYa, t!en ri"en an operate &y t!e latterRs employeeIa$t!ori/e ri"er Clemente .l#aro, *!ic! "an collie *it!
t!e train o# 0NR, at aro$n DH26 ..M. o# .$%$st 44, 199D, *it!in t!e "icinity o# t!e Ma%allanes Interc!an%e in Ma'ati City,
Metro Manila, 0!ilippinesJ
<2=) .t t!e time o# t!e "e!ic$larItrain collision, t!e s$&?ect site o# t!e "e!ic$larItrain collision *as a railroa crossin% $se &y
motorists #or crossin% t!e railroa trac'sJ
<6=) D$rin% t!e sai time o# t!e "e!ic$larItrain collision, t!ere *ere no appropriate an sa#ety *arnin% si%ns an railin%s at t!e
site commonly $se #or railroa crossin%J
<D=) .t t!e material time, co$ntless n$m&er o# Ma'ati &o$n p$&lic $tility an pri"ate "e!icles $se on a aily &asis t!e site o#
t!e collision as an alternati"e ro$te an s!ortEc$t to Ma'atiJ
<1=) T!e train ri"er or operator le#t t!e scene o# t!e incient on &oar t!e comm$ter train in"ol"e *it!o$t *aitin% #or t!e
police in"esti%atorJ
<B=) T!e site commonly $se #or railroa crossin% &y motorists *as not in #act intene &y t!e railroa operator #or railroa
crossin% at t!e time o# t!e "e!ic$lar collisionJ
<9=) 0NR recei"e t!e eman letter o# t!e spo$ses SarateJ
<15=0) 0NR re#$se to ac'no*le%e any lia&ility #or t!e "e!ic$larItrain collisionJ
<11=) T!e e"ent$al clos$re o# t!e railroa crossin% alle%e &y 0NR *as an internal arran%ement &et*een t!e #ormer an its
pro?ect contractorJ an
<14=) T!e site o# t!e "e!ic$larItrain collision *as *it!in t!e "icinity or less t!an 155 meters #rom t!e Ma%allanes station o# 0NR.
>. ISS@ES
<1= :!et!er or not e#enantEri"er o# t!e "an is, in t!e per#ormance o# !is #$nctions, lia&le #or ne%li%ence constit$tin% t!e
proCimate ca$se o# t!e "e!ic$lar collision, *!ic! res$lte in t!e eat! o# plainti## spo$sesR sonJ
<4= :!et!er or not t!e e#enant spo$ses 0ereYa &ein% t!e employer o# e#enant .l#aro are lia&le #or any ne%li%ence *!ic!
may &e attri&$te to e#enant .l#aroJ
<3= :!et!er or not e#enant 0!ilippine National Rail*ays &ein% t!e operator o# t!e railroa system is lia&le #or ne%li%ence in
#ailin% to pro"ie ae;$ate sa#ety *arnin% si%ns an railin%s in t!e area commonly $se &y motorists #or railroa crossin%s,
constit$tin% t!e proCimate ca$se o# t!e "e!ic$lar collision *!ic! res$lte in t!e eat! o# t!e plainti## spo$sesR sonJ
<2= :!et!er or not e#enant spo$ses 0ereYa are lia&le #or &reac! o# t!e contract o# carria%e *it! plainti##Espo$ses in #ailin% to
pro"ie ae;$ate an sa#e transportation #or t!e latterRs sonJ
<6= :!et!er or not e#enants spo$ses are lia&le #or act$al, moral ama%es, eCemplary ama%es, an attorneyRs #eesJ
<D= :!et!er or not e#enants spo$ses Teoorico an Nanette 0ereYa o&ser"e t!e ili%ence o# employers an sc!ool &$s
operatorsJ
<1= :!et!er or not e#enantEspo$ses are ci"illy lia&le #or t!e acciental eat! o# .aron )o!n SarateJ
<B= :!et!er or not e#enant 0NR *as %rossly ne%li%ent in operatin% t!e comm$ter train in"ol"e in t!e accient, in allo*in%
or toleratin% t!e motorin% p$&lic to cross, an its #ail$re to install sa#ety e"ices or e;$ipment at t!e site o# t!e accient #or t!e
protection o# t!e p$&licJ
<9= :!et!er or not e#enant 0NR s!o$l &e mae to reim&$rse e#enant spo$ses #or any an *!ate"er amo$nt t!e latter
may &e !el ans*era&le or *!ic! t!ey may &e orere to pay in #a"or o# plainti##s &y reason o# t!e actionJ
<15= :!et!er or not e#enant 0NR s!o$l pay plainti##s irectly an #$lly on t!e amo$nts claime &y t!e latter in t!eir
Complaint &y reason o# its %ross ne%li%enceJ
<11= :!et!er or not e#enant 0NR is lia&le to e#enants spo$ses #or act$al, moral an eCemplary ama%es an attorneyRs
#ees.
4
T!e Sarates8 claim a%ainst t!e 0ereYas *as $pon &reac! o# t!e contract o# carria%e #or t!e sa#e transport o# .aronJ &$t t!at a%ainst
0NR *as &ase on ;$asiEelict $ner .rticle 411D, Ci"il Coe.
In t!eir e#ense, t!e 0ereYas a$ce e"ience to s!o* t!at t!ey !a eCercise t!e ili%ence o# a %oo #at!er o# t!e #amily in t!e
selection an s$per"ision o# .l#aro, &y ma'in% s$re t!at .l#aro !a &een iss$e a ri"er8s license an !a not &een in"ol"e in any
"e!ic$lar accient prior to t!e collisionJ t!at t!eir o*n son !a ta'en t!e "an ailyJ an t!at Teooro 0ereYa !a sometimes
accompanie .l#aro in t!e "an8s trips transportin% t!e st$ents to sc!ool.
For its part, 0NR tene to s!o* t!at t!e proCimate ca$se o# t!e collision !a &een t!e rec'less crossin% o# t!e "an *!ose ri"er !a
not #irst stoppe, loo'e an listeneJ an t!at t!e narro* pat! tra"erse &y t!e "an !a not &een intene to &e a railroa crossin% #or
motorists.
Ru1.$g o/ t>6 RTC
On Decem&er 3, 1999, t!e RTC renere its ecision,
3
isposin%H
:,EREFORE, premises consiere, ?$%ment is !ere&y renere in #a"or o# t!e plainti## an a%ainst t!e e#enants orerin% t!em to
?ointly an se"erally pay t!e plainti##s as #ollo*sH
<1= <#or= t!e eat! o# .aronE 0!p65,555.55J
<4= .ct$al ama%es in t!e amo$nt o# 0!p155,555.55J
<3= For t!e loss o# earnin% capacityE 0!p4,159,511.55J
<2= Moral ama%es in t!e amo$nt o# 0!p2,555,555.55J
<6= ECemplary ama%es in t!e amo$nt o# 0!p1,555,555.55J
<D= .ttorney8s #ees in t!e amo$nt o# 0!p455,555.55J an
<1= Cost o# s$it.
SO ORDERED.
On )$ne 49, 4555, t!e RTC enie t!e 0ereYas8 motion #or reconsieration,
2
reiteratin% t!at t!e cooperati"e %ross ne%li%ence o# t!e
0ereYas an 0NR !a ca$se t!e collision t!at le to t!e eat! o# .aronJ an t!at t!e ama%es a*are to t!e Sarates *ere not
eCcessi"e, &$t &ase on t!e esta&lis!e circ$mstances.
T>6 CAGs Ru1.$g
>ot! t!e 0ereYas an 0NR appeale <C...E-.R. CV No. DB91D=.
0NR assi%ne t!e #ollo*in% errors, to *itH
6
T!e Co$rt a 8uo erre inH
1. In #inin% t!e e#enantEappellant 0!ilippine National Rail*ays ?ointly an se"erally lia&le to%et!er *it! e#enantE
appellants spo$ses Teoorico an Nanette 0ereYa an e#enantEappellant Clemente .l#aro to pay plainti##sEappellees #or t!e
eat! o# .aron Sarate an ama%es.
4. In %i"in% #$ll #ait! an merit to t!e oral testimonies o# plainti##sEappellees *itnesses espite o"er*!elmin% oc$mentary
e"ience on recor, s$pportin% t!e case o# e#enantsEappellants 0!ilippine National Rail*ays.
T!e 0ereYas ascri&e t!e #ollo*in% errors to t!e RTC, namelyH
T!e trial co$rt erre in #inin% e#enantsEappellants ?ointly an se"erally lia&le #or act$al, moral an eCemplary ama%es an attorney8s
#ees *it! t!e ot!er e#enants.
T!e trial co$rt erre in ismissin% t!e crossEclaim o# t!e appellants 0ereYas a%ainst t!e 0!ilippine National Rail*ays an in not !olin%
t!e latter an its train ri"er primarily responsi&le #or t!e incient.
T!e trial co$rt erre in a*arin% eCcessi"e ama%es an attorney8s #ees.
T!e trial co$rt erre in a*arin% ama%es in t!e #orm o# ecease8s loss o# earnin% capacity in t!e a&sence o# s$##icient &asis #or s$c!
an a*ar.
On No"em&er 13, 4554, t!e C. prom$l%ate its ecision, a##irmin% t!e #inin%s o# t!e RTC, &$t limite t!e moral ama%es
to 0 4,655,555.55J an elete t!e attorney8s #ees &eca$se t!e RTC i not state t!e #act$al an le%al &ases, to *itH
D
:,EREFORE, premises consiere, t!e assaile Decision o# t!e Re%ional Trial Co$rt, >ranc! 4D5 o# 0araYa;$e City is .FFIRMED
*it! t!e moi#ication t!at t!e a*ar o# .ct$al Dama%es is re$ce to 069,654.1DJ Moral Dama%es is re$ce to 0 4,655,555.55J an
t!e a*ar #or .ttorney8s Fees is Delete.
SO ORDERED.
T!e C. $p!el t!e a*ar #or t!e loss o# .aron8s earnin% capacity, ta'in% co%ni/ance o# t!e r$lin% in Caria%a ". La%$na Taya&as >$s
Company an Manila Railroa Company,
1
*!erein t!e Co$rt %a"e t!e !eirs o# Caria%a a s$m representin% t!e loss o# t!e ecease8s
earnin% capacity espite Caria%a &ein% only a meical st$ent at t!e time o# t!e #atal incient. .pplyin% t!e #orm$la aopte in t!e
.merican ECpectancy Ta&le o# MortalityH9
4I3 C <B5 E a%e at t!e time o# eat!= P li#e eCpectancy
t!e C. etermine t!e li#e eCpectancy o# .aron to &e 39.3 years $pon rec'onin% !is li#e eCpectancy #rom a%e o# 41 <t!e a%e *!en !e
*o$l !a"e %ra$ate #rom colle%e an starte *or'in% #or !is o*n li"eli!oo= instea o# 16 years <!is a%e *!en !e ie=. Consierin%
t!at t!e nat$re o# !is *or' an !is salary at t!e time o# .aron8s eat! *ere $n'no*n, it $se t!e pre"ailin% minim$m *a%e
o# 0 4B5.55Iay to comp$te .aron8s %ross ann$al salary to &e0 115,11D.D6, incl$si"e o# t!e t!irteent! mont! pay. M$ltiplyin% t!is
ann$al salary &y .aron8s li#e eCpectancy o# 39.3 years, !is %ross income *o$l a%%re%ate to 0 2,361,1D2.35, #rom *!ic! !is estimate
eCpenses in t!e s$m o#0 4,1B9,DD2.35 *as e$cte to #inally arri"e at 0 4,1D1,655.55 as net income. D$e to .aron8s comp$te net
income t$rnin% o$t to &e !i%!er t!an t!e amo$nt claime &y t!e Sarates, only 0 4,159,511.55, t!e amo$nt eCpressly praye #or &y
t!em, *as %rante.
On .pril 2, 4553, t!e C. enie t!e 0ereYas8 motion #or reconsieration.
B
Issu6s
In t!is appeal, t!e 0ereYas list t!e #ollo*in% as t!e errors committe &y t!e C., to *itH
I. T!e lo*er co$rt erre *!en it $p!el t!e trial co$rt8s ecision !olin% t!e petitioners ?ointly an se"erally lia&le to pay ama%es *it!
0!ilippine National Rail*ays an ismissin% t!eir crossEclaim a%ainst t!e latter.
II. T!e lo*er co$rt erre in a##irmin% t!e trial co$rt8s ecision a*arin% ama%es #or loss o# earnin% capacity o# a minor *!o *as only a
!i%! sc!ool st$ent at t!e time o# !is eat! in t!e a&sence o# s$##icient &asis #or s$c! an a*ar.
III. T!e lo*er co$rt erre in not re$cin% #$rt!er t!e amo$nt o# ama%es a*are, ass$min% petitioners are lia&le at all.
Ru1.$g
T!e petition !as no merit.
1.
36,6 t>6 "6,6I#s #$% "NR Do.$t1-
#$% s6v6,#11- 1.#;16 /o, %#:#g6sC
T!e Sarates &ro$%!t t!is action #or reco"ery o# ama%es a%ainst &ot! t!e 0ereYas an t!e 0NR, &asin% t!eir claim a%ainst t!e 0ereYas
on &reac! o# contract o# carria%e an a%ainst t!e 0NR on ;$asiEelict.
T!e RTC #o$n t!e 0ereYas an t!e 0NR ne%li%ent. T!e C. a##irme t!e #inin%s.
:e conc$r *it! t!e C..
To start *it!, t!e 0ereYas8 e#ense *as t!at t!ey eCercise t!e ili%ence o# a %oo #at!er o# t!e #amily in t!e selection an s$per"ision
o# .l#aro, t!e "an ri"er, &y seein% to it t!at .l#aro !a a ri"er8s license an t!at !e !a not &een in"ol"e in any "e!ic$lar accient
prior to t!e #atal collision *it! t!e trainJ t!at t!ey e"en !a t!eir o*n son tra"el to an #rom sc!ool on a aily &asisJ an t!at Teooro
0ereYa !imsel# sometimes accompanie .l#aro in transportin% t!e passen%ers to an #rom sc!ool. T!e RTC %a"e scant consieration
to s$c! e#ense &y re%arin% s$c! e#ense as inappropriate in an action #or &reac! o# contract o# carria%e.
:e #in no ae;$ate ca$se to i##er #rom t!e concl$sions o# t!e lo*er co$rts t!at t!e 0ereYas operate as a common carrierJ an t!at
t!eir stanar o# care *as eCtraorinary ili%ence, not t!e orinary ili%ence o# a %oo #at!er o# a #amily.
.lt!o$%! in t!is ?$risiction t!e operator o# a sc!ool &$s ser"ice !as &een $s$ally re%are as a pri"ate carrier,
9
primarily &eca$se !e
only caters to some speci#ic or pri"ile%e ini"i$als, an !is operation is neit!er open to t!e ine#inite p$&lic nor #or p$&lic $se, t!e
eCact nat$re o# t!e operation o# a sc!ool &$s ser"ice !as not &een #inally settle. T!is is t!e occasion to lay t!e matter to rest.
. carrier is a person or corporation *!o $nerta'es to transport or con"ey %oos or persons #rom one place to anot!er, %rat$ito$sly or
#or !ire. T!e carrier is classi#ie eit!er as a pri"ateIspecial carrier or as a commonIp$&lic carrier.
15
. pri"ate carrier is one *!o, *it!o$t
ma'in% t!e acti"ity a "ocation, or *it!o$t !olin% !imsel# or itsel# o$t to t!e p$&lic as reay to act #or all *!o may esire !is or its
ser"ices, $nerta'es, &y special a%reement in a partic$lar instance only, to transport %oos or persons #rom one place to anot!er eit!er
%rat$ito$sly or #or !ire.
11
T!e pro"isions on orinary contracts o# t!e Ci"il Coe %o"ern t!e contract o# pri"ate carria%e.T!e ili%ence
re;$ire o# a pri"ate carrier is only orinary, t!at is, t!e ili%ence o# a %oo #at!er o# t!e #amily. In contrast, a common carrier is a
person, corporation, #irm or association en%a%e in t!e &$siness o# carryin% or transportin% passen%ers or %oos or &ot!, &y lan,
*ater, or air, #or compensation, o##erin% s$c! ser"ices to t!e p$&lic.
14
Contracts o# common carria%e are %o"erne &y t!e pro"isions on
common carriers o# t!e Ci"il Coe, t!e 0$&lic Ser"ice .ct,
13
an ot!er special la*s relatin% to transportation. . common carrier is
re;$ire to o&ser"e eCtraorinary ili%ence, an is pres$me to &e at #a$lt or to !a"e acte ne%li%ently in case o# t!e loss o# t!e e##ects
o# passen%ers, or t!e eat! or in?$ries to passen%ers.
12
In relation to common carriers, t!e Co$rt e#ine p$&lic $se in t!e #ollo*in% terms in @nite States ". Tan 0iaco,
16
"i/H
M0$&lic $seM is t!e same as M$se &y t!e p$&licM. T!e essential #eat$re o# t!e p$&lic $se is not con#ine to pri"ile%e ini"i$als, &$t is
open to t!e ine#inite p$&lic. It is t!is ine#inite or $nrestricte ;$ality t!at %i"es it its p$&lic c!aracter. In eterminin% *!et!er a $se is
p$&lic, *e m$st loo' not only to t!e c!aracter o# t!e &$siness to &e one, &$t also to t!e propose moe o# oin% it. I# t!e $se is merely
optional *it! t!e o*ners, or t!e p$&lic &ene#it is merely inciental, it is not a p$&lic $se, a$t!ori/in% t!e eCercise o# t!e ?$risiction o# t!e
p$&lic $tility commission. T!ere m$st &e, in %eneral, a ri%!t *!ic! t!e la* compels t!e o*ner to %i"e to t!e %eneral p$&lic. It is not
eno$%! t!at t!e %eneral prosperity o# t!e p$&lic is promote. 0$&lic $se is not synonymo$s *it! p$&lic interest. T!e tr$e criterion &y
*!ic! to ?$%e t!e c!aracter o# t!e $se is *!et!er t!e p$&lic may en?oy it &y ri%!t or only &y permission.
In De 0uzman v. Court of Appeals,
1D
t!e Co$rt note t!at .rticle 1134 o# t!e Ci"il Coe a"oie any istinction &et*een a person or an
enterprise o##erin% transportation on a re%$lar or an isolate &asisJ an !as not istin%$is!e a carrier o##erin% !is ser"ices to t!e
%eneral p$&lic, t!at is, t!e %eneral comm$nity or pop$lation, #rom one o##erin% !is ser"ices only to a narro* se%ment o# t!e %eneral
pop$lation.
Nonet!eless, t!e concept o# a common carrier em&oie in .rticle 1134 o# t!e Ci"il Coe coincies neatly *it! t!e notion o# p$&lic
ser"ice $ner t!e 0$&lic Ser"ice .ct, *!ic! s$pplements t!e la* on common carriers #o$n in t!e Ci"il Coe. 0$&lic ser"ice, accorin%
to Section 13, para%rap! <&= o# t!e 0$&lic Ser"ice .ct, incl$esH
C C C e"ery person t!at no* or !erea#ter may o*n, operate, mana%e, or control in t!e 0!ilippines, #or !ire or compensation, *it! %eneral
or limite clientZle, *!et!er permanent or occasional, an one #or t!e %eneral &$siness p$rposes, any common carrier, railroa, street
rail*ay, traction rail*ay, s$&*ay motor "e!icle, eit!er #or #rei%!t or passen%er, or &ot!, *it! or *it!o$t #iCe ro$te an *!ate"er may &e
its classi#ication, #rei%!t or carrier ser"ice o# any class, eCpress ser"ice, steam&oat, or steams!ip line, pontines, #erries an *ater cra#t,
en%a%e in t!e transportation o# passen%ers or #rei%!t or &ot!, s!ipyar, marine repair s!op, iceEre#ri%eration plant, canal, irri%ation
system, %as, electric li%!t, !eat an po*er, *ater s$pply an po*er petrole$m, se*era%e system, *ire or *ireless comm$nications
systems, *ire or *ireless &roacastin% stations an ot!er similar p$&lic ser"ices. C C C.
11
-i"en t!e &reat! o# t!e a#ore;$ote c!aracteri/ation o# a common carrier, t!e Co$rt !as consiere as common carriers pipeline
operators,
1B
c$stom &ro'ers an *are!o$semen,
19
an &ar%e operators
45
e"en i# t!ey !a limite clientZle.
.s all t!e #ore%oin% inicate, t!e tr$e test #or a common carrier is not t!e ;$antity or eCtent o# t!e &$siness act$ally transacte, or t!e
n$m&er an c!aracter o# t!e con"eyances $se in t!e acti"ity, &$t *!et!er t!e $nerta'in% is a part o# t!e acti"ity en%a%e in &y t!e
carrier t!at !e !as !el o$t to t!e %eneral p$&lic as !is &$siness or occ$pation. I# t!e $nerta'in% is a sin%le transaction, not a part o#
t!e %eneral &$siness or occ$pation en%a%e in, as a"ertise an !el o$t to t!e %eneral p$&lic, t!e ini"i$al or t!e entity renerin%
s$c! ser"ice is a pri"ate, not a common, carrier. T!e ;$estion m$st &e etermine &y t!e c!aracter o# t!e &$siness act$ally carrie on
&y t!e carrier, not &y any secret intention or mental reser"ation it may entertain or assert *!en c!ar%e *it! t!e $ties an o&li%ations
t!at t!e la* imposes.
41
.pplyin% t!ese consierations to t!e case &e#ore $s, t!ere is no ;$estion t!at t!e 0ereYas as t!e operators o# a sc!ool &$s ser"ice
*ereH <a= en%a%e in transportin% passen%ers %enerally as a &$siness, not ?$st as a cas$al occ$pationJ <&= $nerta'in% to carry
passen%ers o"er esta&lis!e roas &y t!e met!o &y *!ic! t!e &$siness *as con$cteJ an <c= transportin% st$ents #or a #ee.
Despite caterin% to a limite clientZle, t!e 0ereYas operate as a common carrier &eca$se t!ey !el t!emsel"es o$t as a reay
transportation iniscriminately to t!e st$ents o# a partic$lar sc!ool li"in% *it!in or near *!ere t!ey operate t!e ser"ice an #or a #ee.
T!e common carrier8s stanar o# care an "i%ilance as to t!e sa#ety o# t!e passen%ers is e#ine &y la*. -i"en t!e nat$re o# t!e
&$siness an #or reasons o# p$&lic policy, t!e common carrier is &o$n Mto o&ser"e eCtraorinary ili%ence in t!e "i%ilance o"er t!e
%oos an #or t!e sa#ety o# t!e passen%ers transporte &y t!em, accorin% to all t!e circ$mstances o# eac! case.M
44
.rticle 1166 o# t!e
Ci"il Coe speci#ies t!at t!e common carrier s!o$l Mcarry t!e passen%ers sa#ely as #ar as !$man care an #oresi%!t can pro"ie, $sin%
t!e $tmost ili%ence o# "ery ca$tio$s persons, *it! a $e re%ar #or all t!e circ$mstances.M To s$ccess#$lly #en o## lia&ility in an action
$pon t!e eat! or in?$ry to a passen%er, t!e common carrier m$st pro"e !is or its o&ser"ance o# t!at eCtraorinary ili%enceJ ot!er*ise,
t!e le%al pres$mption t!at !e or it *as at #a$lt or acte ne%li%ently *o$l stan.
43
No e"ice, *!et!er &y stip$lation, postin% o# notices,
statements on tic'ets, or ot!er*ise, may ispense *it! or lessen t!e responsi&ility o# t!e common carrier as e#ine $ner .rticle 1166
o# t!e Ci"il Coe.
42
.n, seconly, t!e 0ereYas !a"e not presente any compellin% e#ense or reason &y *!ic! t!e Co$rt mi%!t no* re"erse t!e C.8s
#inin%s on t!eir lia&ility. On t!e contrary, an eCamination o# t!e recors s!o*s t!at t!e e"ience #$lly s$pporte t!e #inin%s o# t!e C..
.s earlier state, t!e 0ereYas, actin% as a common carrier, *ere alreay pres$me to &e ne%li%ent at t!e time o# t!e accient &eca$se
eat! !a occ$rre to t!eir passen%er.
46
T!e pres$mption o# ne%li%ence, &ein% a pres$mption o# la*, lai t!e &$ren o# e"ience on
t!eir s!o$lers to esta&lis! t!at t!ey !a not &een ne%li%ent.
4D
It *as t!e la* no less t!at re;$ire t!em to pro"e t!eir o&ser"ance o#
eCtraorinary ili%ence in seein% to t!e sa#e an sec$re carria%e o# t!e passen%ers to t!eir estination. @ntil t!ey i so in a crei&le
manner, t!ey stoo to &e !el le%ally responsi&le #or t!e eat! o# .aron an t!$s to &e !el lia&le #or all t!e nat$ral conse;$ences o#
s$c! eat!.
T!ere is no ;$estion t!at t!e 0ereYas i not o"ert$rn t!e pres$mption o# t!eir ne%li%ence &y crei&le e"ience. T!eir e#ense o#
!a"in% o&ser"e t!e ili%ence o# a %oo #at!er o# a #amily in t!e selection an s$per"ision o# t!eir ri"er *as not le%ally s$##icient.
.ccorin% to .rticle 1169 o# t!e Ci"il Coe, t!eir lia&ility as a common carrier i not cease $pon proo# t!at t!ey eCercise all t!e
ili%ence o# a %oo #at!er o# a #amily in t!e selection an s$per"ision o# t!eir employee. T!is *as t!e reason *!y t!e RTC treate t!is
e#ense o# t!e 0ereYas as inappropriate in t!is action #or &reac! o# contract o# carria%e.
T!e 0ereYas *ere lia&le #or t!e eat! o# .aron espite t!e #act t!at t!eir ri"er mi%!t !a"e acte &eyon t!e scope o# !is a$t!ority or
e"en in "iolation o# t!e orers o# t!e common carrier.
41
In t!is connection, t!e recors s!o*e t!eir ri"er8s act$al ne%li%ence. T!ere
*as a s!o*in%, to &e%in *it!, t!at t!eir ri"er tra"erse t!e railroa trac's at a point at *!ic! t!e 0NR i not permit motorists %oin%
into t!e Ma'ati area to cross t!e railroa trac's. .lt!o$%! t!at point !a &een $se &y motorists as a s!ortc$t into t!e Ma'ati area, t!at
#act alone i not eCc$se t!eir ri"er into ta'in% t!at ro$te. On t!e ot!er !an, *it! !is #amiliarity *it! t!at s!ortc$t, t!eir ri"er *as #$lly
a*are o# t!e ris's to !is passen%ers &$t !e still isre%are t!e ris's. Compo$nin% !is lac' o# care *as t!at lo$ m$sic *as playin%
insie t!e airEconitione "an at t!e time o# t!e accient. T!e lo$ness most pro&a&ly re$ce !is a&ility to !ear t!e *arnin% !orns o#
t!e oncomin% train to allo* !im to correctly appreciate t!e l$r'in% an%ers on t!e railroa trac's. .lso, !e so$%!t to o"erta'e a
passen%er &$s on t!e le#t sie as &ot! "e!icles tra"erse t!e railroa trac's. In so oin%, !e lost !is "ie* o# t!e train t!at *as t!en
comin% #rom t!e opposite sie o# t!e passen%er &$s, leain% !im to miscalc$late !is c!ances o# &eatin% t!e &$s in t!eir race, an o#
%ettin% clear o# t!e train. .s a res$lt, t!e &$s a"oie a collision *it! t!e train &$t t!e "an %ot slamme at its rear, ca$sin% t!e #atality.
Lastly, !e i not slo* o*n or %o to a #$ll stop &e#ore tra"ersin% t!e railroa trac's espite 'no*in% t!at !is slac'enin% o# spee an
%oin% to a #$ll stop *ere in o&ser"ance o# t!e ri%!t o# *ay at railroa trac's as e#ine &y t!e tra##ic la*s an re%$lations.
4B
,e t!ere&y
"iolate a speci#ic tra##ic re%$lation on ri%!t o# *ay, &y "irt$e o# *!ic! !e *as immeiately pres$me to &e ne%li%ent.
49
T!e omissions o# care on t!e part o# t!e "an ri"er constit$te ne%li%ence,
35
*!ic!, accorin% to Lay$%an ". Intermeiate .ppellate
Co$rt,
31
is Mt!e omission to o somet!in% *!ic! a reasona&le man, %$ie &y t!ose consierations *!ic! orinarily re%$late t!e
con$ct o# !$man a##airs, *o$l o, or t!e oin% o# somet!in% *!ic! a pr$ent an reasona&le man *o$l not o,
34
or as )$%e Cooley
e#ines it, V<t=!e #ail$re to o&ser"e #or t!e protection o# t!e interests o# anot!er person, t!at e%ree o# care, preca$tion, an "i%ilance
*!ic! t!e circ$mstances ?$stly eman, *!ere&y s$c! ot!er person s$##ers in?$ry.8M
33
T!e test &y *!ic! to etermine t!e eCistence o# ne%li%ence in a partic$lar case !as &een aptly state in t!e leain% case o# 0icart ".
Smit!,
32
t!$s*iseH
T!e test &y *!ic! to etermine t!e eCistence o# ne%li%ence in a partic$lar case may &e state as #ollo*sH Di t!e e#enant in oin% t!e
alle%e ne%li%ent act $se t!at reasona&le care an ca$tion *!ic! an orinarily pr$ent person *o$l !a"e $se in t!e same sit$ationL
I# not, t!en !e is %$ilty o# ne%li%ence. T!e la* !ere in e##ect aopts t!e stanar s$ppose to &e s$pplie &y t!e ima%inary con$ct o#
t!e iscreet pater#amilias o# t!e Roman la*. T!e eCistence o# ne%li%ence in a %i"en case is not etermine &y re#erence to t!e personal
?$%ment o# t!e actor in t!e sit$ation &e#ore !im. T!e la* consiers *!at *o$l &e rec'less, &lame*ort!y, or ne%li%ent in t!e man o#
orinary intelli%ence an pr$ence an etermines lia&ility &y t!at.
T!e ;$estion as to *!at *o$l constit$te t!e con$ct o# a pr$ent man in a %i"en sit$ation m$st o# co$rse &e al*ays etermine in t!e
li%!t o# !$man eCperience an in "ie* o# t!e #acts in"ol"e in t!e partic$lar case. .&stract spec$lation cannot !ere &e o# m$c! "al$e
&$t t!is m$c! can &e pro#ita&ly saiH Reasona&le men %o"ern t!eir con$ct &y t!e circ$mstances *!ic! are &e#ore t!em or 'no*n to
t!em. T!ey are not, an are not s$ppose to &e, omniscient o# t!e #$t$re. ,ence t!ey can &e eCpecte to ta'e care only *!en t!ere is
somet!in% &e#ore t!em to s$%%est or *arn o# an%er. Co$l a pr$ent man, in t!e case $ner consieration, #oresee !arm as a res$lt
o# t!e co$rse act$ally p$rs$eL I# so, it *as t!e $ty o# t!e actor to ta'e preca$tions to %$ar a%ainst t!at !arm. Reasona&le #oresi%!t
o# !arm, #ollo*e &y t!e i%norin% o# t!e s$%%estion &orn o# t!is pre"ision, is al*ays necessary &e#ore ne%li%ence can &e !el to eCist.
State in t!ese terms, t!e proper criterion #or eterminin% t!e eCistence o# ne%li%ence in a %i"en case is t!isH Con$ct is sai to &e
ne%li%ent *!en a pr$ent man in t!e position o# t!e tort#easor *o$l !a"e #oreseen t!at an e##ect !arm#$l to anot!er *as s$##iciently
pro&a&le to *arrant !is #ore%oin% t!e con$ct or %$arin% a%ainst its conse;$ences. <Emp!asis s$pplie=
0$rs$ant to t!e +icart v. 3mith test o# ne%li%ence, t!e 0ereYas8 ri"er *as entirely ne%li%ent *!en !e tra"erse t!e railroa trac's at a
point not allo*e #or a motorist8s crossin% espite &ein% #$lly a*are o# t!e %ra"e !arm to &e t!ere&y ca$se to !is passen%ersJ an
*!en !e isre%are t!e #oresi%!t o# !arm to !is passen%ers &y o"erta'in% t!e &$s on t!e le#t sie as to lea"e !imsel# &lin to t!e
approac! o# t!e oncomin% train t!at !e 'ne* *as on t!e opposite sie o# t!e &$s.
@nrelentin%, t!e 0ereYas cite 0!il. National Rail*ays ". Intermeiate .ppellate Co$rt,
36
*!ere t!e Co$rt !el t!e 0NR solely lia&le #or
t!e ama%es ca$se to a passen%er &$s an its passen%ers *!en its train !it t!e rear en o# t!e &$s t!at *as t!en tra"ersin% t!e
railroa crossin%. >$t t!e circ$mstances o# t!at case an t!is one s!are no similarities. In 0!ilippine National Rail*ays ". Intermeiate
.ppellate Co$rt, no e"ience o# contri&$tory ne%li%ence *as a$ce a%ainst t!e o*ner o# t!e &$s. Instea, it *as t!e o*ner o# t!e &$s
*!o pro"e t!e eCercise o# eCtraorinary ili%ence &y preponerant e"ience. .lso, t!e recors are replete *it! t!e s!o*in% o#
ne%li%ence on t!e part o# &ot! t!e 0ereYas an t!e 0NR. .not!er istinction is t!at t!e passen%er &$s in 0!ilippine National Rail*ays ".
Intermeiate .ppellate Co$rt *as tra"ersin% t!e eicate railroa crossin% *!en it *as !it &y t!e train, &$t t!e 0ereYas8 sc!ool "an
tra"erse t!e railroa trac's at a point not intene #or t!at p$rpose.
.t any rate, t!e lo*er co$rts correctly !el &ot! t!e 0ereYas an t!e 0NR M?ointly an se"erallyM lia&le #or ama%es arisin% #rom t!e
eat! o# .aron. T!ey !a &een impleae in t!e same complaint as e#enants a%ainst *!om t!e Sarates !a t!e ri%!t to relie#,
*!et!er ?ointly, se"erally, or in t!e alternati"e, in respect to or arisin% o$t o# t!e accient, an ;$estions o# #act an o# la* *ere common
as to t!e Sarates.
3D
.lt!o$%! t!e &asis o# t!e ri%!t to relie# o# t!e Sarates <i.e., &reac! o# contract o# carria%e= a%ainst t!e 0ereYas *as
istinct #rom t!e &asis o# t!e Sarates8 ri%!t to relie# a%ainst t!e 0NR <i.e., ;$asiEelict $ner .rticle 411D, Ci"il Coe=, t!ey nonet!eless
co$l &e !el ?ointly an se"erally lia&le &y "irt$e o# t!eir respecti"e ne%li%ence com&inin% to ca$se t!e eat! o# .aron. .s to t!e 0NR,
t!e RTC ri%!tly #o$n t!e 0NR also %$ilty o# ne%li%ence espite t!e sc!ool "an o# t!e 0ereYas tra"ersin% t!e railroa trac's at a point
not eicate &y t!e 0NR as a railroa crossin% #or peestrians an motorists, &eca$se t!e 0NR i not ens$re t!e sa#ety o# ot!ers
t!ro$%! t!e placin% o# cross&ars, si%nal li%!ts, *arnin% si%ns, an ot!er permanent sa#ety &arriers to pre"ent "e!icles or peestrians
#rom crossin% t!ere. T!e RTC o&ser"e t!at t!e #act t!at a crossin% %$ar !a &een assi%ne to man t!at point #rom 1 a.m. to 6 p.m.
*as a %oo inici$m t!at t!e 0NR *as a*are o# t!e ris's to ot!ers as *ell as t!e nee to control t!e "e!ic$lar an ot!er tra##ic t!ere.
Verily, t!e 0ereYas an t!e 0NR *ere ?oint tort#easors.
2.
3#s t>6 .$%6:$.t- /o, 1oss o/
A#,o$Gs 6#,$.$g 0#2#0.t- 2,o26,C
T!e RTC a*are inemnity #or loss o# .aron8s earnin% capacity. .lt!o$%! a%reein% *it! t!e RTC on t!e lia&ility, t!e C. moi#ie t!e
amo$nt. >ot! lo*er co$rts too' into consieration t!at .aron, *!ile only a !i%! sc!ool st$ent, !a &een enrolle in one o# t!e
rep$ta&le sc!ools in t!e 0!ilippines an t!at !e !a &een a normal an a&leE&oie c!il prior to !is eat!. T!e &asis #or t!e
comp$tation o# .aron8s earnin% capacity *as not *!at !e *o$l !a"e &ecome or *!at !e *o$l !a"e *ante to &e i# not #or !is
$ntimely eat!, &$t t!e minim$m *a%e in e##ect at t!e time o# !is eat!. Moreo"er, t!e RTC8s comp$tation o# .aron8s li#e eCpectancy
rate *as not rec'one #rom !is a%e o# 16 years at t!e time o# !is eat!, &$t on 41 years, !is a%e *!en !e *o$l !a"e %ra$ate #rom
colle%e.
:e #in t!e consierations ta'en into acco$nt &y t!e lo*er co$rts to &e reasona&le an #$lly *arrante.
Uet, t!e 0ereYas s$&mit t!at t!e inemnity #or loss o# earnin% capacity *as spec$lati"e an $n#o$ne.1;$phi1 T!ey cite 0eople ".
Tee!an'ee, )r.,
31
*!ere t!e Co$rt elete t!e inemnity #or "ictim )$ssi Leino8s loss o# earnin% capacity as a pilot #or &ein% spec$lati"e
$e to !is !a"in% %ra$ate #rom !i%! sc!ool at t!e International Sc!ool in Manila only t*o years &e#ore t!e s!ootin%, an *as at t!e
time o# t!e s!ootin% only enrolle in t!e #irst semester at t!e Manila .ero Cl$& to p$rs$e !is am&ition to &ecome a pro#essional pilot.
T!at meant, accorin% to t!e Co$rt, t!at !e *as #or all intents an p$rposes only a !i%! sc!ool %ra$ate.
:e re?ect t!e 0ereYas8 s$&mission.
First o# all, a care#$l per$sal o# t!e Tee!an'ee, )r. case s!o*s t!at t!e sit$ation t!ere o# )$ssi Leino *as not a'in to t!at o# .aron !ere.
T!e C. an t!e RTC *ere not spec$latin% t!at .aron *o$l &e some !i%!lyEpai pro#essional, li'e a pilot <or, #or t!at matter, an
en%ineer, a p!ysician, or a la*yer=. Instea, t!e comp$tation o# .aron8s earnin% capacity *as premise on !im &ein% a lo*ly minim$m
*a%e earner espite !is &ein% t!en enrolle at a presti%io$s !i%! sc!ool li'e Don >osco in Ma'ati, a #act t!at *o$l !a"e li'ely ens$re
!is s$ccess in !is later years in li#e an at *or'.
.n, seconly, t!e #act t!at .aron *as t!en *it!o$t a !istory o# earnin%s s!o$l not &e ta'en a%ainst !is parents an in #a"or o# t!e
e#enants *!ose ne%li%ence not only cost .aron !is li#e an !is ri%!t to *or' an earn money, &$t also epri"e !is parents o# t!eir
ri%!t to !is presence an !is ser"ices as *ell. O$r la* itsel# states t!at t!e loss o# t!e earnin% capacity o# t!e ecease s!all &e t!e
lia&ility o# t!e %$ilty party in #a"or o# t!e !eirs o# t!e ecease, an s!all in e"ery case &e assesse an a*are &y t!e co$rt M$nless
t!e ecease on acco$nt o# permanent p!ysical isa&ility not ca$se &y t!e e#enant, !a no earnin% capacity at t!e time o# !is
eat!.M
3B
.ccorin%ly, *e emp!atically !ol in #a"or o# t!e inemni#ication #or .aron8s loss o# earnin% capacity espite !im !a"in% &een
$nemploye, &eca$se compensation o# t!is nat$re is a*are not #or loss o# time or earnin%s &$t #or loss o# t!e ecease8s po*er or
a&ility to earn money.
39
T!is #a"ora&le treatment o# t!e Sarates8 claim is not $npreceente. In Caria%a ". La%$na Taya&as >$s Company an Manila Railroa
Company,
25
#o$rt!Eyear meical st$ent E%aro Carria%a8s earnin% capacity, alt!o$%! !e s$r"i"e t!e accient &$t !is in?$ries
renere !im permanently incapacitate, *as comp$te to &e t!at o# t!e p!ysician t!at !e reame to &ecome. T!e Co$rt consiere
!is sc!olastic recor s$##icient to ?$sti#y t!e ass$mption t!at !e co$l !a"e #inis!e t!e meical co$rse an *o$l !a"e passe t!e
meical &oar eCaminations in $e time, an t!at !e co$l !a"e possi&ly earne a moest income as a meical practitioner. .lso, in
0eople ". Sanc!e/,
21
t!e Co$rt opine t!at m$rer an rape "ictim Eileen Sarmienta an m$rer "ictim .llan -ome/ co$l !a"e easily
lane %ooEpayin% ?o&s !a t!ey %ra$ate in $e time, an t!at t!eir ?o&s *o$l pro&a&ly pay t!em !i%! mont!ly salaries
#rom 0 15,555.55 to 0 16,555.55 $pon t!eir %ra$ation. T!eir earnin% capacities *ere comp$te at rates !i%!er t!an t!e minim$m
*a%e at t!e time o# t!eir eat!s $e to t!eir &ein% alreay senior a%ric$lt$re st$ents o# t!e @ni"ersity o# t!e 0!ilippines in Los >aYos,
t!e co$ntry8s leain% e$cational instit$tion in a%ric$lt$re.
3.
36,6 t>6 #:ou$ts o/ %#:#g6s 6B06ss.v6C
T!e 0ereYas plea #or t!e re$ction o# t!e moral an eCemplary ama%es a*are to t!e Sarates in t!e respecti"e amo$nts
o# 0 4,655,555.55 an 0 1,555,555.55 on t!e %ro$n t!at s$c! amo$nts *ere eCcessi"e.
T!e plea is $n*arrante.
T!e moral ama%es o# 0 4,655,555.55 *ere really ?$st an reasona&le $ner t!e esta&lis!e circ$mstances o# t!is case &eca$se t!ey
*ere intene &y t!e la* to ass$a%e t!e Sarates8 eep mental an%$is! o"er t!eir son8s $neCpecte an "iolent eat!, an t!eir moral
s!oc' o"er t!e senseless accient. T!at amo$nt *o$l not &e too m$c!, consierin% t!at it *o$l !elp t!e Sarates o&tain t!e means,
i"ersions or am$sements t!at *o$l alle"iate t!eir s$##erin% #or t!e loss o# t!eir c!il. .t any rate, re$cin% t!e amo$nt as eCcessi"e
mi%!t pro"e to &e an in?$stice, %i"en t!e passa%e o# a lon% time #rom *!en t!eir mental an%$is! *as in#licte on t!em on .$%$st 44,
199D.
.nent t!e 0 1,555,555.55 allo*e as eCemplary ama%es, *e s!o$l not re$ce t!e amo$nt i# only to rener e##ecti"e t!e esire
eCample #or t!e p$&lic %oo. .s a common carrier, t!e 0ereYas neee to &e "i%oro$sly remine to o&ser"e t!eir $ty to eCercise
eCtraorinary ili%ence to pre"ent a similarly senseless accient #rom !appenin% a%ain. Only &y an a*ar o# eCemplary ama%es in t!at
amo$nt *o$l s$##ice to instill in t!em an ot!ers similarly sit$ate li'e t!em t!e e"erEpresent nee #or %reater an constant "i%ilance in
t!e con$ct o# a &$siness im&$e *it! p$&lic interest.
3HERE!ORE, *e (EN) t!e petition #or re"ie* on certiorariJ A!!IRM t!e ecision prom$l%ate on No"em&er 13, 4554J
an OR(ER t!e petitioners to pay t!e costs o# s$it.
SO ORDERED.
LCAS ". =ERSAMIN
.ssociate )$stice
:E CONC@RH
G.R. No. 114740 5u$6 11, 1779
THE "HILI""INE AMERICAN GENERAL INSRANCE COM"AN), INC., petitioner,
"s.
CORT O! A""EALS #$% !ELMAN SHI""ING LINES, responents.

=ELLOSILLO, J.:
T!is case eals *it! t!e lia&ility, i# any, o# a s!ipo*ner #or loss o# car%o $e to its #ail$re to o&ser"e t!e eCtraorinary ili%ence re;$ire
&y .rt. 1133 o# t!e Ci"il Coe as *ell as t!e ri%!t o# t!e ins$rer to &e s$&ro%ate to t!e ri%!ts o# t!e ins$re $pon payment o# t!e
ins$rance claim.
On D )$ly 19B3 CocaECola >ottlers 0!ilippines, Inc., loae on &oar MMV Asilda,M a "essel o*ne an operate &y responent Felman
S!ippin% Lines <FELM.N #or &re"ity=, 1,655 cases o# 1Eliter CocaECola so#trin' &ottles to &e transporte #rom Sam&oan%a City to Ce&$
City #or consi%nee CocaECola >ottlers 0!ilippines, Inc., Ce&$.
1
T!e s!ipment *as ins$re *it! petitioner 0!ilippine .merican -eneral
Ins$rance Co., Inc. <0,IL.M-EN #or &re"ity=, $ner Marine Open 0olicy No. 1553D1E0.-.
MMV AsildaM le#t t!e port o# Sam&oan%a in #ine *eat!er at ei%!t oRcloc' in t!e e"enin% o# t!e same ay. .t aro$n ei%!t #ortyE#i"e t!e
#ollo*in% mornin%, 1 )$ly 19B3, t!e "essel san' in t!e *aters o# Sam&oan%a el Norte &rin%in% o*n !er entire car%o *it! !er incl$in%
t!e s$&?ect 1,655 cases o# 1Eliter CocaECola so#trin' &ottles.
On 16 )$ly 19B3 t!e consi%nee CocaECola >ottlers 0!ilippines, Inc., Ce&$ plant, #ile a claim *it! responent FELM.N #or reco"ery o#
ama%es it s$staine as a res$lt o# t!e loss o# its so#trin' &ottles t!at san' *it! MMV Asilda.M Responent enie t!e claim t!$s
promptin% t!e consi%nee to #ile an ins$rance claim *it! 0,IL.M-EN *!ic! pai its claim o# 0166,465.55.
Claimin% its ri%!t o# s$&ro%ation 0,IL.M-EN so$%!t reco$rse a%ainst responent FELM.N *!ic! isclaime any lia&ility #or t!e loss.
Conse;$ently, on 49 No"em&er 19B3 0,IL.M-EN s$e t!e s!ipo*ner #or s$m o# money an ama%es.
In its complaint 0,IL.M-EN alle%e t!at t!e sin'in% an total loss o# MMV AsildaM an its car%o *ere $e to t!e "esselRs
$nsea*ort!iness as s!e *as p$t to sea in an $nsta&le conition. It #$rt!er alle%e t!at t!e "essel *as improperly manne an t!at its
o##icers *ere %rossly ne%li%ent in #ailin% to ta'e appropriate meas$res to procee to a near&y port or &eac! a#ter t!e "essel starte to
list.
On 16 Fe&r$ary 19B6 FELM.N #ile a motion to ismiss &ase on t!e a##irmati"e e#ense t!at no ri%!t o# s$&ro%ation in #a"or o#
0,IL.M-EN *as transmitte &y t!e s!ipper, an t!at, in any e"ent, FELM.N !a a&anone all its ri%!ts, interests an o*ners!ip
o"er MMV AsildaM to%et!er *it! !er #rei%!t an app$rtenances #or t!e p$rpose o# limitin% an eCtin%$is!in% its lia&ility $ner .rt. 6B1 o#
t!e Coe o# Commerce.
2
On 11 Fe&r$ary 19BD t!e trial co$rt ismisse t!e complaint o# 0,IL.M-EN. On appeal t!e Co$rt o# .ppeals set asie t!e ismissal
an remane t!e case to t!e lo*er co$rt #or trial on t!e merits. FELM.N #ile a petition #orcertiorari *it! t!is Co$rt &$t it *as
s$&se;$ently enie on 13 Fe&r$ary 19B9.
On 4B Fe&r$ary 1994 t!e trial co$rt renere ?$%ment in #a"or o# FELM.N.
3
It r$le t!at MMV AsildaM *as sea*ort!y *!en it le#t t!e
port o# Sam&oan%a as con#irme &y certi#icates iss$e &y t!e 0!ilippine Coast -$ar an t!e s!ipo*nerRs s$r"eyor attestin% to its
sea*ort!iness. T!$s t!e loss o# t!e "essel an its entire s!ipment co$l only &e attri&$te to eit!er a #ort$ito$s e"ent, in *!ic! case, no
lia&ility s!o$l attac! $nless t!ere *as a stip$lation to t!e contrary, or to t!e ne%li%ence o# t!e captain an !is cre*, in *!ic! case, .rt.
6B1 o# t!e Coe o# Commerce s!o$l apply.
T!e lo*er co$rt #$rt!er r$le t!at ass$min% MMV AsildaM *as $nsea*ort!y, still 0,IL.M-EN co$l not reco"er #rom FELM.N since t!e
ass$re <CocaECola >ottlers 0!ilippines, Inc.= !a &reac!e its implie *arranty on t!e "esselRs sea*ort!iness. Res$ltantly, t!e
payment mae &y 0,IL.M-EN to t!e ass$re *as an $n$e, *ron% an mista'en payment. Since it *as not le%ally o*in%, it i not
%i"e 0,IL.M-EN t!e ri%!t o# s$&ro%ation so as to permit it to &rin% an action in co$rt as a s$&ro%ee.
On 1B Marc! 1994 0,IL.M-EN appeale t!e ecision to t!e Co$rt o# .ppeals. On 49 .$%$st 1992 responent appellate co$rt
renere ?$%ment #inin% MMV AsildaM $nsea*ort!y #or &ein% topE!ea"y as 4,655 cases o# CocaECola so#trin' &ottles *ere improperly
sto*e on ec'. In ot!er *ors, *!ile t!e "essel possesse t!e necessary Coast -$ar certi#ication inicatin% its sea*ort!iness *it!
respect to t!e str$ct$re o# t!e s!ip itsel#, it *as not sea*ort!y *it! respect to t!e car%o. Nonet!eless, t!e appellate co$rt enie t!e
claim o# 0,IL.M-EN on t!e %ro$n t!at t!e ass$reRs implie *arranty o# sea*ort!iness *as not complie *it!. 0er#$nctorily,
0,IL.M-EN *as not properly s$&ro%ate to t!e ri%!ts an interests o# t!e s!ipper. F$rt!ermore, responent co$rt !el t!at t!e #ilin% o#
notice o# a&anonment !a a&sol"e t!e s!ipo*nerIa%ent #rom lia&ility $ner t!e limite lia&ility r$le.
T!e iss$es #or resol$tion in t!is petition areH <a= *!et!er MMV AsildaM *as sea*ort!y *!en it le#t t!e port o# Sam&oan%aJ <&= *!et!er t!e
limite lia&ility $ner .rt. 6B1 o# t!e Coe o# Commerce s!o$l applyJ an, <c= *!et!er 0,IL.M-EN *as properly s$&ro%ate to t!e
ri%!ts an le%al actions *!ic! t!e s!ipper !a a%ainst FELM.N, t!e s!ipo*ner.
MMV AsildaM *as $nsea*ort!y *!en it le#t t!e port o# Sam&oan%a. In a ?oint statement, t!e captain as *ell as t!e c!ie# mate o# t!e
"essel con#irme t!at t!e *eat!er *as #ine *!en t!ey le#t t!e port o# Sam&oan%a. .ccorin% to t!em, t!e "essel *as carryin% 1,655
cases o# 1Eliter CocaECola so#trin' &ottles, 355 sac's o# sea*ees, 455 empty CO4 cyliners an an $netermine ;$antity o# empty
&oCes #or #res! e%%s. T!ey loae t!e empty &oCes #or e%%s an a&o$t 655 cases o# CocaECola &ottles on ec'.
4
T!e s!ip captain
state t!at aro$n #o$r oRcloc' in t!e mornin% o# 1 )$ly 19B3 !e *as a*a'ene &y t!e o##icer on $ty to in#orm !im t!at t!e "essel !a
!it a #loatin% lo%. .t t!at time !e notice t!at t!e *eat!er !a eteriorate *it! stron% so$t!east *ins in$cin% &i% *a"es. .#ter t!irty
min$tes !e o&ser"e t!at t!e "essel *as listin% sli%!tly to star&oar an *o$l not correct itsel# espite t!e !ea"y rollin% an pitc!in%.
,e t!en orere !is cre* to s!i#t t!e car%o #rom star&oar to portsie $ntil t!e "essel *as &alance. .t a&o$t se"en oRcloc' in t!e
mornin%, t!e master o# t!e "essel stoppe t!e en%ine &eca$se t!e "essel *as listin% an%ero$sly to portsie. ,e orere !is cre* to
s!i#t t!e car%o &ac' to star&oar. T!e s!i#tin% o# car%o too' a&o$t an !o$r a#ter*!ic! !e ran% t!e en%ine room to res$me #$ll spee.
.t aro$n ei%!t #ortyE#i"e, t!e "essel s$enly liste to portsie an &e#ore t!e captain co$l ecie on !is neCt mo"e, some o# t!e
car%o on ec' *ere t!ro*n o"er&oar an sea*ater entere t!e en%ine room an car%o !ols o# t!e "essel. .t t!at instance, t!e
master o# t!e "essel orere !is cre* to a&anon s!ip. S!ortly t!erea#ter, MMV AsildaM capsi/e an san'. ,e ascri&e t!e sin'in% to
t!e entry o# sea*ater t!ro$%! a !ole in t!e !$ll ca$se &y t!e "esselRs collision *it! a partially s$&mer%e lo%.
5
T!e Elite .?$sters, Inc., s$&mitte a report re%arin% t!e sin'in% o# MMV Asilda.M T!e report, *!ic! *as aopte &y t!e Co$rt o#
.ppeals, reas Q
:e #o$n in t!e co$rse o# o$r in"esti%ation t!at a reasona&le eCplanation #or t!e series o# lists eCperience &y t!e
"essel t!at e"ent$ally le to !er capsi/in% an sin'in%, *as t!at t!e "essel *astop<heav" *!ic! is to say t!at *!ile
t!e "essel may not !a"e &een o"erloae, yet t!e istri&$tion or sto*a%e o# t!e car%o on &oar *as one in s$c! a
manner t!at t!e "essel *as in topE!ea"y conition at t!e time o# !er epart$re an *!ic! conition renere !er
$nsta&le an $nsea*ort!y #or t!at partic$lar "oya%e.
In t!is connection, *e *is! to call attention to t!e #act t!at t!is "essel *as esi%ne as a #is!in% "essel . . . an it *as
not esi%ne to carry a s$&stantial amo$nt or ;$antity o# car%o on ec'. T!ere#ore, *e &elie"e stron%ly t!at !a !er
car%o &een con#ine to t!ose t!at co$l !a"e &een accommoate $ner ec', !er sta&ility *o$l not !a"e &een
a##ecte an t!e "essel *o$l not !a"e &een in any an%er o# capsi/in%, e"en %i"en t!e pre"ailin% *eat!er conitions
at t!at time o# sin'in%.
>$t #rom t!e moment t!at t!e "essel *as $tili/e to loa !ea"y car%o on its ec', t!e "essel *as renere
$nsea*ort!y #or t!e p$rpose o# carryin% t!e type o# car%o &eca$se t!e *ei%!t o# t!e ec' car%o so ecrease t!e
"esselRs metacentric !ei%!t as to ca$se it to &ecome $nsta&le.
Finally, *it! re%ar to t!e alle%ation t!at t!e "essel enco$ntere &i% *a"es, it m$st &e pointe o$t t!at s!ips are
precisely esi%ne to &e a&le to na"i%ate sa#ely e"en $rin% !ea"y *eat!er an #re;$ently *e !ear o# s!ips sa#ely
an s$ccess#$lly *eat!erin% enco$nters *it! typ!oons an alt!o$%! t!ey may s$stain some amo$nt o# ama%e, t!e
sin'in% o# s!ip $rin% !ea"y *eat!er is not a #re;$ent occ$rrence an is not li'ely to occ$r $nless t!ey are in!erently
$nsta&le an $nsea*ort!y . . . .
:e &elie"e, t!ere#ore, an so !ol t!at t!e pro*imate cause o# t!e sin'in% o# t!e MIV MAsildaM *as !er conition o#
$nsea*ort!iness arisin% #rom !er !a"in% &een topE!ea"y *!en s!e eparte #rom t!e 0ort o# Sam&oan%a. ,er
!a"in% capsi/e an e"ent$ally s$n' *as &o$n to !appen an *as t!ere#ore in t!e cate%ory o# an ine"ita&le
occ$rrence <emp!asis s$pplie=.
4
:e s$&scri&e to t!e #inin%s o# t!e Elite .?$sters, Inc., an t!e Co$rt o# .ppeals t!at t!e proCimate ca$se o# t!e sin'in% o# MMV AsildaM
*as its &ein% topE!ea"y. Contrary to t!e s!ip captainRs alle%ations, e"ience s!o*s t!at approCimately 4,655 cases o# so#trin' &ottles
*ere sto*e on ec'. Se"eral ays a#ter MMV AsildaM san', an estimate 4,655 empty CocaECola plastic cases *ere reco"ere near
t!e "icinity o# t!e sin'in%. Consierin% t!at t!e s!ipRs !atc!es *ere properly sec$re, t!e empty CocaECola cases reco"ere co$l !a"e
come only #rom t!e "esselRs ec' car%o. It is settle t!at carryin% a ec' car%o raises t!e pres$mption o# $nsea*ort!iness $nless it can
&e s!o*n t!at t!e ec' car%o *ill not inter#ere *it! t!e proper mana%ement o# t!e s!ip. ,o*e"er, in t!is case it *as esta&lis!e t!at
MMV AsildaM *as not esi%ne to carry s$&stantial amo$nt o# car%o on ec'. T!e inorinate loain% o# car%o ec' res$lte in t!e
ecrease o# t!e "esselRs metacentric !ei%!t
9
t!$s ma'in% it $nsta&le. T!e stron% *ins an *a"es enco$ntere &y t!e "essel are &$t
t!e orinary "icissit$es o# a sea "oya%e an as s$c! merely contri&$te to its alreay $nsta&le an $nsea*ort!y conition.
On t!e secon iss$e, .rt. 6B1 o# t!e Coe o# Commerce is not applica&le to t!e case at &ar.
8
Simply p$t, t!e s!ip a%ent is lia&le #or t!e
ne%li%ent acts o# t!e captain in t!e care o# %oos loae on t!e "essel. T!is lia&ility !o*e"er can &e limite t!ro$%! a&anonment o#
t!e "essel, its e;$ipment an #rei%!ta%e as pro"ie in .rt. 6B1. Nonet!eless, t!ere are eCceptional circ$mstances *!erein t!e s!ip
a%ent co$l still &e !el ans*era&le espite t!e a&anonment, as *!ere t!e loss or in?$ry *as $e to t!e #a$lt o# t!e s!ipo*ner an t!e
captain.
7
T!e international r$le is to t!e e##ect t!at t!e ri%!t o# a&anonment o# "essels, as a le%al limitation o# a s!ipo*nerRs lia&ility,
oes not apply to cases *!ere t!e in?$ry or a"era%e *as occasione &y t!e s!ipo*nerRs o*n #a$lt.
10
It m$st &e stresse at t!is point
t!at .rt. 6B1 spea's only o# sit$ations *!ere t!e #a$lt or ne%li%ence is committe solely &y t!e captain. :!ere t!e s!ipo*ner is li'e*ise
to &e &lame, .rt. 6B1 *ill not apply, an s$c! sit$ation *ill &e co"ere &y t!e pro"isions o# t!e Ci"il Coe on common carrier.
11
It *as alreay esta&lis!e at t!e o$tset t!at t!e sin'in% o# MMV AsildaM *as $e to its $nsea*ort!iness e"en at t!e time o# its epart$re
#rom t!e port o# Sam&oan%a. It *as topE!ea"y as an eCcessi"e amo$nt o# car%o *as loae on ec'. Closer s$per"ision on t!e part o#
t!e s!ipo*ner co$l !a"e pre"ente t!is #atal miscalc$lation. .s s$c!, FELM.N *as e;$ally ne%li%ent. It cannot t!ere#ore escape
lia&ility t!ro$%! t!e eCpeient o# #ilin% a notice o# a&anonment o# t!e "essel &y "irt$e o# .rt. 6B1 o# t!e Coe o# Commerce.
@ner .rt 1133 o# t!e Ci"il Coe, M<c=ommon carriers, #rom t!e nat$re o# t!eir &$siness an #or reasons o# p$&lic policy, are &o$n to
o&ser"e eCtraorinary ili%ence in t!e "i%ilance o"er t!e %oos an #or t!e sa#ety o# t!e passen%ers transporte &y t!em, accorin% to
all t!e circ$mstances o# eac! case . . .M In t!e e"ent o# loss o# %oos, common carriers are pres$me to !a"e acte ne%li%ently.
FELM.N, t!e s!ipo*ner, *as not a&le to re&$t t!is pres$mption.
In relation to t!e ;$estion o# s$&ro%ation, responent appellate co$rt #o$n MMV AsildaM $nsea*ort!y *it! re#erence to t!e car%o an
t!ere#ore r$le t!at t!ere *as &reac! o# *arranty o# sea*ort!iness t!at renere t!e ass$re not entitle to t!e payment o# is claim
$ner t!e policy. ,ence, *!en 0,IL.M-EN pai t!e claim o# t!e &ottlin% #irm t!ere *as in e##ect a M"ol$ntary paymentM an no ri%!t o#
s$&ro%ation accr$e in its #a"or. In ot!er *ors, *!en 0,IL.M-EN pai it i so at its o*n ris'.
It is %enerally !el t!at in e"ery marine ins$rance policy t!e ass$re impliely *arrants to t!e ass$rer t!at t!e "essel is sea*ort!y an
s$c! *arranty is as m$c! a term o# t!e contract as i# eCpressly *ritten on t!e #ace o# t!e policy.
12
T!$s Sec. 113 o# t!e Ins$rance Coe
pro"ies t!at M<i=n e"ery marine ins$rance $pon a s!ip or #rei%!t, or #rei%!ta%e, or $pon anyt!in% *!ic! is t!e s$&?ect o# marine
ins$rance, a *arranty is implie t!at t!e s!ip is sea*ort!y.M @ner Sec. 112, a s!ip is Msea*ort!y *!en reasona&ly #it to per#orm t!e
ser"ice, an to enco$nter t!e orinary perils o# t!e "oya%e, contemplate &y t!e parties to t!e policy.M T!$s it &ecomes t!e o&li%ation o#
t!e car%o o*ner to loo' #or a relia&le common carrier *!ic! 'eeps its "essels in sea*ort!y conition. ,e may !a"e no control o"er t!e
"essel &$t !e !as #$ll control in t!e selection o# t!e common carrier t!at *ill transport !is %oos. ,e also !as #$ll iscretion in t!e c!oice
o# ass$rer t!at *ill $ner*rite a partic$lar "ent$re.
:e nee not &ela&or t!e alle%e &reac! o# *arranty o# sea*ort!iness &y t!e ass$re as painsta'in%ly pointe o$t &y FELM.N to stress
t!at s$&ro%ation *ill not *or' in t!is case. In policies *!ere t!e la* *ill %enerally imply a *arranty o# sea*ort!iness, it can only &e
eCcl$e &y terms in *ritin% in t!e policy in t!e clearest lan%$a%e.
13
.n *!ere t!e policy stip$lates t!at t!e sea*ort!iness o# t!e
"essel as &et*een t!e ass$re an t!e ass$rer is amitte, t!e ;$estion o# sea*ort!iness cannot &e raise &y t!e ass$rer *it!o$t
s!o*in% concealment or misrepresentation &y t!e ass$re.
14
T!e marine policy iss$e &y 0,IL.M-EN to t!e CocaECola &ottlin% #irm in at least t*o <4= instances !as ispense *it! t!e $s$al
*arranty o# *ort!iness. 0ara%rap! 16 o# t!e Marine Open 0olicy No. 1553D1E0.- reas M<t=!e li&erties as per Contract o# .##rei%!tment
t!e presence o# t!e Ne%li%ence Cla$se anIor Latent De#ect Cla$se in t!e >ill o# Lain% anIor C!arter 0arty anIor Contract o#
.##rei%!tment as &et*een t!e .ss$re an t!e Company s!all not pre?$ice t!e ins$rance. T!e sea*ort!iness o# t!e "essel as &et*een
t!e .ss$re an t!e .ss$rers is !ere&y amitte.M
15
T!e same cla$se is present in par. B o# t!e Instit$te Car%o Cla$ses <F.0...= o# t!e policy *!ic! states M<t=!e sea*ort!iness o# t!e "essel
as &et*een t!e .ss$re an @ner*riters in !ere&y amitte . . . .M
14
T!e res$lt o# t!e amission o# sea*ort!iness &y t!e ass$rer 0,IL.M-EN may mean one or t*o t!in%sH <a= t!at t!e *arranty o# t!e
sea*ort!iness is to &e ta'en as #$l#illeJ or, <&= t!at t!e ris' o# $nsea*ort!iness is ass$me &y t!e ins$rance company.
19
T!e insertion
o# s$c! *ai"er cla$ses in car%o policies is in reco%nition o# t!e realistic #act t!at car%o o*ners cannot control t!e state o# t!e "essel.
T!$s it can &e sai t!at *it! s$c! cate%orical *ai"er, 0,IL.M-EN !as accepte t!e ris' o# $nsea*ort!iness so t!at i# t!e s!ip s!o$l
sin' &y $nsea*ort!iness, as *!at occ$rre in t!is case, 0,IL.M-EN is lia&le.
,a"in% ispose o# t!is matter, *e mo"e on to t!e le%al &asis #or s$&ro%ation. 0,IL.M-ENRs action a%ainst FELM.N is s;$arely
sanctione &y .rt. 4451 o# t!e Ci"il Coe *!ic! pro"iesH
.rt. 4451. I# t!e plainti##Rs property !as &een ins$re, an !e !as recei"e inemnity #rom t!e ins$rance company #or
t!e in?$ry or loss arisin% o$t o# t!e *ron% or &reac! o# contract complaine o#, t!e ins$rance company s!all &e
s$&ro%ate to t!e ri%!ts o# t!e ins$re a%ainst t!e *ron%oer or t!e person *!o !as "iolate t!e contract. I# t!e
amo$nt pai &y t!e ins$rance company oes not #$lly co"er t!e in?$ry or loss, t!e a%%rie"e party s!all &e entitle to
reco"er t!e e#iciency #rom t!e person ca$sin% t!e loss or in?$ry.
In +an Mala"an %nsurance Corporation v. Court of Appeals,
18
*e sai t!at payment &y t!e ass$rer to t!e ass$re operates as an
e;$ita&le assi%nment to t!e ass$rer o# all t!e remeies *!ic! t!e ass$re may !a"e a%ainst t!e t!ir party *!ose ne%li%ence or
*ron%#$l act ca$se t!e loss. T!e ri%!t o# s$&ro%ation is not epenent $pon, nor oes it %ro* o$t o# any pri"ity o# contract or $pon
payment &y t!e ins$rance company o# t!e ins$rance claim. It accr$es simply $pon payment &y t!e ins$rance company o# t!e ins$rance
claim.
T!e octrine o# s$&ro%ation !as its roots in e;$ity. It is esi%ne to promote an to accomplis! ?$stice an is t!e moe *!ic! e;$ity
aopts to compel t!e $ltimate payment o# a e&t &y one *!o in ?$stice, e;$ity an %oo conscience o$%!t to pay.
17
T!ere#ore, t!e
payment mae &y 0,IL.M-EN to CocaECola >ottlers 0!ilippines, Inc., %a"e t!e #ormer t!e ri%!t to &rin% an action as s$&ro%ee a%ainst
FELM.N. ,a"in% #aile to re&$t t!e pres$mption o# #a$lt, t!e lia&ility o# FELM.N #or t!e loss o# t!e 1,655 cases o# 1Eliter CocaECola
so#trin' &ottles is ine"ita&le.
:,EREFORE, t!e petition is -R.NTED. Responent FELM.N S,I00IN- LINES is orere to pay petitioner 0,ILI00INE
.MERIC.N -ENER.L INS@R.NCE CO., INC., Se"en ,$nre Fi#tyE#i"e T!o$san T*o ,$nre an Fi#ty 0esos <0166,465.55= pl$s
le%al interest t!ereon co$nte #rom 49 No"em&er 19B3, t!e ate o# ?$icial eman, p$rs$ant to .rts. 4414 an 4413 o# t!e Ci"il
Coe.
20
SO ORDERED.
Vitug, =apunan and >ermosisima, Jr., JJ., concur.
+adilla, J., is on leave.