Transportation Proper

8/11/2019 Transportation Proper

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Article 1732 of the Civil Code

COMMON CARRIERS, defined; Common Carriers are persons, corporations, firms or associations engaged in the business of

carrying or transporting passengers or goods or both, by land, water or air, for compensation,offering their services to the public.

Contracts of carriage are governed primarily by the Civil Code, then in a suppletory manner, by theprovisions of the Code of Commerce on Maritime Commerce, the COGSA (Carriage of Goods by SeaAct, and the Salvage !aw.

"#$

%or someone to be considered a common carrier, it is not re&uired that it should be his principal

business. 'ven if that is what is nown as his )sideline*, he is still a common carrier.

De Guzman vs. CA (168 SCRA 612)

+he law defining a common carrier maes no distinction whether the carriage of goods or

persons is the principal or merely ancillary activity of the carrier.

+he fact that there is no fied or regular schedule in transporting goods for others does not

distract from the fact that he is a common carrier.

A school bus service is a Common Carrier and although it does not cater to the general public,

but to a limited clientele, and the school bus was hired for a special trip to the province, courtsaid that it is still a common carrier although it usually caters only to a limited segment of

society and that the trip to the province was not a regular trip but an unscheduled and specialtrip.

+he fact that the Common Carrier does not have a certificate of public convenience does not

distract from the fact that it is a common carrier (although operating illegally. Otherwise, it

would be better off than a company that is operating legally.

First Philippine Inustrial Pipeline vs. CA (!"" SCRA 661)

A company which transports petroleum products from a refinery to a terminal by means of apipeline is a common carrier because it is transporting goods.

-$ hat is included in the word transportation/A$ 0t includes$

1. waiting time,2. loading and unloading,

3. stopping in transit, and4. all other accessorial services in connection with the loaded movement

True Test of Co!!on Crrier +he carriage of goods and passengers, provided it has space for all who opt to avail

themselves of its transportation for a fee 5"ational Steel v. CA, 263 SC7A 489

One is still considered Co!!on Crrier "for the #rovisions of the Civil Code to ##l$%even if&

1. 5:e Gu;man v. CA 51


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2. %?0C v. CA 53@@ SC7A


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-+. The chrcter of the *oods or defects in the #cin* or in the continers;

%ruits cannot be prevented from becoming ripe during the course of the voyage, naturalprocess.

Southern Lines vs. CA (4 SCRA 159)

0f the fact of improper pacing is nown to the carrier, or apparent upon ordinary observation,

but it accepts the goods notwithstanding such condition, it is not relieved of liability for loss or

inury.

-. Order or ct of co!#etent #u(lic uthorit$'

Ganzon vs. CA (161 SCRA 646)

+he order must be a valid order, not an illegal order. One cannot invoe that as a valid ecuse.

Collision

0f there is a collision, its eclusively the fault of another vessel, of course the other vessel will

be ecused from liability. #ut if there is concurring negligence, that will not eempt the carrier fromliability.

%or eample, a vessel collided with a taner when they should have had a looout at night,

and then the person in charge of the vessel was unsilled, and when it became apparent that acollision might occur, the vessel steered to the left, when under the rules of navigation, it should

steer to the right, so they collided.

Or when a vessel saw that a collision might occur but it too evasive action too late or startedtaing evasive action when collision was already imminent.

+he fault of the owner will only minimi;e the liability of the shipping company but will not

eempt it from liability.

Ar!ed Ro((er$

0n the de Gu;man case, a stipulation providing that a common carrier will not be liable foracts committed by robbers who act without irresistible force would not be valid.

A carrier cannot be eempt from liability if it fails to show that the robbers acted with

irresistible force.

i(ilit$ of Co!!on Crrier of 4oods

'ffects when the Goods are !ost, :estroyed or :eteriorated 5Art. 1F389

The shi##er5consi*nee hs cuse of ction for (rech of contrct *inst the

crrier

The co!!on crrier is 6RESME8 to hve (een t fult or to hve cted ne*li*entl$

1st Effect&

-$ hat does the shipper or consignee have to show in order to have a prima facie case against thecarrier/

A$ +he following$1. ?roof of actual delivery of goods in good order to carrier, and

2. %ailure of carrier to deliver the goods in the same condition as when they werereceived 5Hnchausti v. :eter, 41 ? 26B9

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2nd Effect&-$ >ow can the carrier rebut the automatic presumption of negligence against it/

A$ +he common carrier must prove that it eercised EO diligence in the vigilance over the goodsaccording to all the circumstances of each case 5Art. 1F38, 1F339

Effects hen n$ of the E)ce#tions re 6resent&

1. +here is no presumption that the common carrier acted negligently2. +he common carrier need not prove that it eercised etraordinary diligence in the vigilance over

the goods,3. #+, the common carrier is not automatically eempt from liabilityI it has to prove that it

complied with the re&uirements under Art. 1F3B, 1F4@, 1F41, 1F42, and 1F43

9o Co!!on Crrier of 4oods Cn Esc#e i(ilit$

1st E)ce#tion"A+7A! :0SAS+'7 J flood, storm, earth&uae, lightning, or other natural disaster or

calamity 5Art. 1F34.19

Re0uisites : The co!!on crrier !ust sho tht&1. +he natural disaster must have been the proimate and only cause of the loss 5Art. 1F3B9,2. 0t eercised :' diligence to prevent or minimi;e the loss #'%O7', :70"G or A%+'7 the

occurrence 5Art. 1F3B9,

3. 0t did not incur in delay in transporting the goods 5Art. 1F4@9

2nd E)ce#tion+he AC+ O% ?#!0C '"'MH in war, whether international or civil 5Art. 1F34.29

Re0uisites : The co!!on crrier !ust sho tht&1. +he natural disaster must have been the proimate and only cause of the loss 5Art. 1F3B9,

2. 0t eercised :' diligence to prevent or minimi;e the loss #'%O7', :70"G or A%+'7 theoccurrence 5Art. 1F3B9

3rd E)ce#tionAC+ or OM0SS0O" of the S>0??'7 or O"'7 of the goods 5Art. 1F34.39

Re0uisite&

+he CC has to prove that the act of the shipper is the proimate and only cause of the loss+he CC CA""O+ escape liability 5but damages shall be e&uitably reduced9 $

1. 0f the proimate cause of the loss is the negligence of the CC2. +he shipper merely contributed to the loss, destruction, or deterioration 5Art. 1F419

+th E)ce#tion+he C>A7AC+'7 of the GOO:S or :'%'C+S in the ?ACK0"G or in the CO"+A0"'7 5Art.

1F34.49

Re0uisite&+he common carrier must prove that it eercised :' diligence to %O7'S+A!! or !'SS'" the

loss 5Art. 1F429

th E)ce#tion0f through the O7:'7 Of ?#!0C A+>O70+H the goods are sei;ed or destroyed 5Art. 1F439

7e&uisites$

1.+he person maing the order must have the power or authority to issue such order, and

2. +he order is lawful or has been issued under legal process or authority 5Gan;on v. CA, 1


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Article 173' In ll cses other thn those !entioned in "173+%, if the *oods re lost,destro$ed or deteriorted, co!!on crriers re #resu!ed to hve (een t fult or to hve

cted ne*li*entl$, unless the$ #rove tht the$ o(served e)trordinr$ dili*ence sre0uired in rticle 1733'

Mechanical failure is not a fortuitous event.

Crac in the steering nucle

+ires eploded

:efect in the braes

Article 173' The e)trordinr$ res#onsi(ilit$ of the co!!on crrier lsts fro! the ti!ethe *oods re unconditionll$ #lced in the #ossession of, nd received ($ the crrier for

trns#orttion until the s!e re delivered, ctull$ or constructivel$, ($ the crrier tothe consi*nee, or to the #erson ho hs ri*ht to receive the!, ithout #re


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-+. Tht the co!!on crrier need not o(serve n$ dili*ence less thn tht of *oodfther of f!il$;

-. Tht the co!!on crrier shll not (e res#onsi(le for the cts or o!issions of hise!#lo$ees;

-. Tht the co!!on crriers li(ilit$ for cts co!!itted ($ thieves or ro((ers hodo not ct ith *rve nd irresisti(le force, thret or violence is dis#ensed ith or

di!inished;-7. Tht the co!!on crrier is not res#onsi(le for the loss, destruction or

deteriortion of the *oods on ccount of the defective condition of the cr,vehicle, hi#, ir#lne or other e0ui#!ent used in the contrct of crri*e'

A provision saying that the carrier is not liable for loss is void. A provision limiting the liability

to a fied amount is also void. #ut, a provision limiting the liability to a certain fied amount unlessthe shipper declared a higher value and pays the corresponding freight for that higher value would b

reasonable.

?rovisions limiting the liability of the carrier cannot be invoed if the carrier incurs in delay.nless, the delay is due to the fault of the government or of 3 rdpersons, beyond the control of the

carrier.

Article 173' The l of the countr$ to hich the *oods re to (e trns#orted should*overn the li(ilit$ of the co!!on crrier for their loss, destruction or deteriortion'

!aw of the destination governs under conflicts of law.

Article 17+' In the cse of (***e of #ssen*ers, if the$ re in the #ersonl custod$ of

the #ssen*er, then li(ilit$ of the co!!on crrier ill (e tht of (ilee5de#ositr$'

%or eample, hand carried baggage of a passenger. +he common carrier is re&uired only toobserve the due diligence of a good father of a family. #+, for checJin luggage, the carrier will

have to eercise etraordinary diligence.

Article 17' Co!!on crriers re re0uired to o(serve e)trordinr$ dili*ence for the

sfet$ of their #ssen*ers'

Article 17' In the cse of deth or in


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the loss as between the two. Since the carriers are both at fault, it will not apply. #ut, with respectto passengers, each will be liable for their own.

0f the bus was speeding, a passenger was inured, the bus company will be liable. #ut if the

passenger is guilty of contributory negligence, then that will minimi;e, but will not eempt theliability of the carrier.

Article 177'the res#onsi(ilit$ of co!!on crrier for the sfet$ of #ssen*ers sre0uired in this rticles 1733:17 cnnot (e dis#ensed 5 or lessened ($ sti#ultion ($

the #ostin* of notices ($ stte!ents on ticets or otherise

Any stipulation or notice or ticet, limiting liability of common carrier or observance of EO

diligence is not allowed

Article 17=' If the #ssen*er is crried *rtuitousl$, the li(ilit$ of the co!!on crrier

!$ (e li!ited ($ sti#ultion to onl$ due dili*ence of *ood fther of f!il$' ?T, itcnnot e)e!#t it fro! *ross ne*li*ence'

The reduction of fred oes not


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0f you have lost inco!e, the formula being used here is 6@ minus age, multiplied by annualincome, and you get 2=3 of that. 0n other words, the formula is$

2=3 5(6@Jage annual income9

"ow, you have that Pa+illa ase. A plane of ?A! crashed. 0n the case of Davila vs. PAL,the

Court ruled that it was the fault of ?A!. ?A! was claiming that there were disturbances in theweather, etc. #ut the Court did not accept that. So the Supreme Court said that in the :avila case,

?A! was at fault. After that case was decided, this ?adilla case was litigated. ?adilla was anotherpassenger there. >e was a chance passenger but was accomodated because the regular passengers

did not show up. ?adilla was hurrying to return to Manila for his wedding. >e perished in that planecrash (female classmates instantly reacted, )awwwL*. So his widowed mom sued for damages. 0

handled the case for ?A! in the Court of Appeals, and argued that since SC already ruled in :avilacase that ?A! was at fault, then the only issue is the etent of ?A!s liability. So 0 tried to reduce the

liability of ?A!. 0 cited some cases that in computing the income, you should use the life epectancyof the mother. #ecause even if the son had not died, the mother would not have received the

income of the son until the death of the son, because the mother could have died ahead of the son,because in the normal course of events, the mother would die ahead of her son. +herefore, she

could not have received the income of her son after her death. So you only compute her lifeepectancy. +he CA ruled in favor of the mother. On appeal, the SC reected that argument. +he SC

said that the life epectancy of the son should be used as the basis even if the life epectancy of the

mother is shorter.

Morl d!*es

+he Court has said that moral damages can be recovered in case of death. +he court recently

ruled that you dont have to prove mental anguish. 0n previous cases, the court said that moraldamages cant be recovered in cases of death because nobody testified. #ut in a recent decision, the

Court said that mental anguish need not be proven, because it is presumed.

Also, under the Civil Code, as a rule, you can recover moral damages for the breach ofcontract only if there is death or bad faith. +he Court has applied that to gross negligence

amounting to bad faith. +heres this one case where the bus was speeding, and the passengers

were already asing the driver to slow down, but he ust ignored them. +he Court said that it wasgross negligence amounting to bad faith.

Attorne$s fees

+his can be recovered in any of the cases under Article 22@6 of the Civil Code, lie if thecarrier acted in bad faith in refusing to settle with the heirs of the passengers who died.

PAL ase - 1?A! was flying to O;amis City, but it was not able to proceed because of the inclement

weather. So they went to Cotabato. A passenger sued. >e said that he was not provided with

transportation from airport to hotel, and was not given any hotel accommodation and meals.>eld$ +he contract of carriage is not terminated until the passenger reaches its destination.

So in this case, the contract of carriage was only temporarily suspended, so ?A! should haveprovided the passenger with hotel accommodation and meals, etc.

AL aseNA! could not proceed to Manila because Mt. ?inatubo erupted and the runway was covered

with ash. ?assenger sued, and said that he was not provided with hotel accommodation and meals.

>e invoed the ruling in ?A!.>eld$ +he delay was due to fortuitous event. 0t was not due to the fault of NA!, and they are

not obliged to provide for hotel accommodation.

Jimenez Transcripts (Transportation and Public Service Law)Page $ of 25


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PAL ase - !

0n a subse&uent case involving another passenger in that suspended ?A! flight to O;amis, apassenger was invoing the ruling in ?A! case 1. #ut the Court bactraced and said that its

ruling in the ?A! case 1 was misunderstood. +he reason why ?A! was held liable was becausethere was discrimination. +hey provided other passengers with the hotel accommodation, so it was

because of discrimination.

So the ?7'S'"+ 7!'$ if the flight is interrupted due to fortuitous event, the airline company is notobliged to provide hotel accommodation and meals. #ut if it is due to their fault, lie engine trouble,

they have to provide accommodation. sually, may mga tieJup na naman yang mga hotel na yan.!ie ?A!, thats why 0 never tae ?A!P (Nacs story about how bad ?A! is omitted .

Airline cses

Cuena ase

Cuenca was going to Napan. >e was downgraded from 1st class to economy. >e sued fordamages, and the Court held "orthwest Airlines liable.

Air /rane v. Carrasoso

Carrascoso (C was taing the flight of Air %arnce, 1

st

class. hen he arrived in #ango, hewas told to give up his seat for a white man, and to transfer to 'conomy. C said, )Over my dead

body.* +here was a heated argument. #ut C eventually transferred to 'conomy, but later on sued fordamages.

>eld$ Common carrier is not only obliged to transport its passengers safely, but alsocourteously. +herefore, C can sue for tort. #ecause when you sue for breach of contract, you can

recover moral damages only if there is death or bad faith= fraud. #ut if you are suing on tort, youcan always recover moral damages.

Caguioa critici;es this doctrine. >e said that that is true in common law. e follow Civil !aw.

nder the Civil Code, for a &uasiJdelict to eist, there must be no contractual relation. +heres arecent decision of Nustice ?ardo where he said that if theres a contract, you cant have a &uasiJdelict

by epress provision of lawP although the case did not involve a contract of carriage. #ut he said

that in a recent decision.

0ulueta ase>is wife and daughter were returning from S to ?hilippines. At that time, wala pang nonJ

stop flights. hen the plane had a stopJover at a certain island, Qulueta said that he had an upset

stomach, but the lavatories were occupied. So he went to the beach (female classmates react again,

)yuuucL*. hen the flight was about to resume the flight, he was not yet there. So the planewaited for him, because once you checed in your luggage and you dont return, the plane will not

leave you. +here might be a reason why you are not therePthere might be a bomb in your luggage.

+hey will have to either wait for you or unload all the luggage and leave yours behind. So theysent employees to loo for Qulueta. +he employees saw Qulueta strolling in the beach, so they

brought him bac to the plane. +he pilot ordered the search of his luggage. Qulueta refused, unlesstheres a search warrant. So the pilot left the luggage behind.

Qulueta sued for damages. >e claimed that the pilot shouted at him. ?ilot said that theyreceived a tip that there was a bomb, so they suspected Qulueta who was reluctant to board the

plane.>eld$ Awarded moral and eemplary damages. >e was insulted. +here was humiliation.

Catha Pai2i ase

?assenger was going to Naarta. Suitcase was sent to >K. >e ased for help, but Cathayreplied, )O, what can we do/* >e was treated rudely. ?assenger sued for damages.

>eld$ %or being discourteous, Cathay shall be held liable for damages.

Jimenez Transcripts (Transportation and Public Service Law)Page % of 25


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E)e!#lr$ d!*es

+his is awarded as a penalty for misconduct or wrongdoing. +herefore, you impose it only

against the person whos guilty of misconduct. So even if the driver is recless, you cannot imposeit on the employer, unless you can show that the employer shared in the misconduct, i.e., he was

aware that the driver was negligent, but they tolerated it.

0n S, under the rules of Civil Aeronautics #oard, airline companies are allowed to overbooby 1@R. %rom eperience, not everyone shows up, so if there are vacancies, thats lost revenue. So

overbooing is allowed. +he problem is if everyone shows up. 0n such a case, the airline companyshould as for volunteers who are willing to give up their seats, and theyll be given some sort of

compensation for that. 0f no volunteers, those who checed in last will be displaced.

0alaea aseQalamea was not accommodated because flight was overbooed. +he Court said that since

ticet was bought in the ?hilippines, ?hilippine laws should govern, and so the airline companycannot invoe that ruling of the S CA#.

PAL ase?A! made a stop over in >onolulu and unloaded luggage of some passengers so it could tae

in cargoes to earn more freight. Court said that theres bad faith. ?A! deliberately left behindluggage of passengers to earn more freight. !iable for damages.

3orthest ase"orthwest left some baggage because of weight and balance restriction. Court said that "

cannot be held liable for damages. ell, you now, those %ilipinos carry a lot of #alibayan boes.And 0 thin that if you are going to S, the flight going there is shorter than the flight returning. '

pano, ang mga ?ilipino, madaming dala, so the plane is slower (+his time, everybody, not ust thegirls, reacted. +awang tawa si ?edroL

BARSAB CONENTION -BC.

+heres a limitation on liability of lost luggage. >owever, the court has said that$1 nder the C, if a passenger was not given a baggage claim tab, the Airline Company cannot

invoe that limited liability.

2 C says that limited liability cannot be invoed when the word used is the %rench word, )dol*,e&uivalent to the Spanish word, )dolo*. #ut in the 'nglish translation of the C, it was translated

as )willful misconduct*. +he Court has said time and again that when the luggage is lost because

of reclessness of the airline company, it cant invoe its limited liability under the C.

+he provisions under the C do not bar the passenger to sue instead under the Civil Code.

!ie theres a provision there for lost luggage, you have to file a claim from the airline companywithin 14 days, otherwise, your claim will be barred. +he Court has said that even if the passenger

does not do that, the C does not bar him to claim under the Civil Code. Or the 2Jyear prescriptiveperiod under the C.

+hat will not apply if the passenger was humiliated and treated discourteously. 0n the nited

Airlines case, the passenger made a demand, but he was given the run around. +he Court said thatsince the delay in filing was due to the evasiveness of the airline company, the prescriptive period

under the C shall not apply.

PAL ase?A! unloaded luggage of passengers to tae in cargoes to earn more freight.

>eld$ +here was misconduct. So you cant invoe limited liability.

Jimenez Transcripts (Transportation and Public Service Law)Page 1& of 25


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'ritish Airas?assenger proved that the value of his lost suitcase was greater than the value provided in

the C. "o obection was made.>eld$ +hat is waiver of the limited liability under the C.

Jimenez Transcripts (Transportation and Public Service Law)Page 11 of 25


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departure is not e&uivalent to the place of destination. hat you have is an option to tae the flightto the place where you came from. 0n this case, therefore, the place of destination is Manila.

Spener vs. 37 8rient Airlines

hen you are suing on a tort, the C provisions on venue are not applicable.

#ar. $% 2""2 Per& Arist&n

MARITIMEABD A8MIRAT

'ill o2 La+in'v. Arts. "618% C&e &* C&mmer+e,?urposes$

1. Contract2. 7eceipt for the goods the shipping company recogni;es it as receipt for the goods.

3. Symbol of the goods covered by it that is why the goods can be sold and ownership can betransferred by merely delivering the bill of lading

One of the more important classes of bill of lading is the clen (ill of ldin* that means it is an

acnowledgement by the vessel that there are no defects in the cargoes when they too delivery,therefore if upon delivery to the consignee there are damages, then the common carrier will be

liable.

+he carrier may refuse to transport pacages which appear unfit for transportation. And if the carrier

believes that the declaration made by the shipper regarding the contents of the pacage is false,

then the carrier can eamine the pacage in the presence of witnesses of the shipper or consignee.And if it turns out that the suspicions of the common carrier are false, and that the declaration is

correct then the epenses for reJpacing the goods will be borne by the carrier.

+he shipper may change the consignee but he must surrender the bill of lading. +he carrier will beliable for any damages, loss of the goods or diminution in their value.

+he Court has said that the delivery of cargoes to consignee is valid even if the original bill of lading

was not surrendered where the bill of lading was not received by the consignee or anyway the goods

were delivered to the actual consignee.

Consolidted Mines Cse. C&ns&liate #ines imp&rte minin- euipment an &pene

a letter &* +reit. /he 0ill &* lain- as sent t& the 0an hi+h &pene the letter &*+reit 0e+ause the 0an has n&t 0een pai. /he +arrier elivere the euipment t&

C&ns&liate #ines even i* the 0ill &* lain- as n&t surrenere 03 the latter 0e+ause

the 0ill as in the p&ssessi&n &* the 0an. C&ns&liate #ines i n&t pa3 the 0an.4&% the 0an uesti&nin- the +arrier% 5h3 i 3&u eliver the euipment t&

C&ns&liate #ines ith&ut reuirin- the surrener &* the 0ill &* lain- an the 0ill is

in &ur p&ssessi&n7 /he C&urt sai that the 0an +&ul n&t sue the +arrier i* the+&nsi-nee% C&ns&liate #ines% i n&t pa3 it 0e+ause the +&nsi-nee ias C&ns&liate

#ines. S& the3 elivere the euipment t& the +&rre+t pers&n. I* the 0an as n&tpai% thats 0eteen the 0an an the +&nsi-nee'

aa:er ($) Case. +his fellow eported goods to >ong Kong. %ollowing long practice, they

instructed the shipping company to deliver the goods to the buyer in >ong Kong, without

re&uiring the presentation of bill of lading. Shipper complied with that. +he buyer did not pay.+he seller wanted to run after the shipping companyT)why did you release the cargo without

re&uiring the presentation of the bill of lading/* +he Court said, )ell that was your instruction.+hey complied with your instruction. So you cannot hold the shipping company liable.*

0f the consignee delays in taing delivery of the goods he will be liable for the voyage.



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en ;ua ($) Pro+uts Case. Keng >ua refused to tae delivery of the goodsTpaper productsT

because they said that they did not comply with the specifications with the contract. Meanwhile

the vessel was stuc there accumulating demurrage. +he court said$ if the products delivered bythe seller have not complied with the specification of the contract, the vessel is not liable for that.

Hou run after the seller. So you cannot refuse and delay in taing delivery of the goods on thatground. So youll be liable for the demurrage.

>owever if the delay was due to a fortuitous event, the consignee will not be liable for demurrage.

'.g. $ (a 0n one case, where the consignee was not able to tae delivery right away because therewas error in the manifest and then the e&uipment of the arrastre operator broe down, so thats not

his faultI (b Or because there was a strie in the pier.

aellan($) Case. +he letter of credit, which the buyer of the imported goods opened, contained

a provision prohibiting transshipment of the goods. +he shipping transshipped the goods onanother vessel. And, there was a provision in the bill of lading issued that there be a

transshipment. +he seller accepted the bill of lading without protesting. Although the in the letterof credit there was a stipulation there will be no transshipment, the bill of lading said there will

be a transshipment. +he buyer refused to accept the goods, our agreement was that there shallbe no transshipment. +he seller now was running after the vessel. +he court said$ "o, because

that agreement that there shall be no transshipment is ust between the two of you. +he carrieris not bound by that and in the bill of lading which the seller issued there is a stipulation that the

goods would be transshipped, and you accepted it, you did not obect. So in the contractbetween you and the 5carrier9 there was a provision for transshipment, you cannot sue the

carrier if the buyer refuse to tae delivery of the goods.

+he consignee may refuse to tae delivery of the goods and may abandon the goods in certaincases, vi;.$

1. 0f there was partial nonJdelivery and you cannot mae use of the parts delivered. !ie they arecomponents of an e&uipment and without the missing parts you cannot use the e&uipment.

2. 0f the goods were rendered useless for the purpose for which they were intended. '.g. you

imported a thoroughbred and the legs of the horse were broen during the shipment.3. 0f there is delay thru the fault of the carrier

"ow, if upon delivery of the goods, it is obvious from the eternal appearance of the pacages that

there were damages, the consignee must immediately file a claim. 0f that is not apparent from theeternal condition of the pacages, then he has 24 hours from delivery within which to file a claim. 0fthe claim is not filed within this period as mentioned in the law, then that will be barred because

compliance with that is a condition precedent for a filing a case in court.

Management contracts with the arrastre operators contain this common provisions that$ (a theconsignee must file the claims within 18 days otherwise all claims will be barredI (b in case the

claim is denied, he has 1 year to sue, otherwise the action will be barredI (c the arrastre will onlybe liable for a certain amount, 0 thin lie ?2,@@@, unless a higher value is declared. +he court has

said$ where this is provided in the management contract between the government and the arrastreoperator is a contract with a stipulation for the benefit of a third person, the consignee. And

therefore, they are bound by the stipulation if they mae use of the services of the arrastre operatorpursuant to that management contract. #ut if they did not avail of the services, lie the goods were

never delivered, they never too delivery, so thatP(inaudiblePthat limitation of liability will notapply.

0n one case, lie what San Miguel did, they wanted to play safe, to mae sure that any claims will

not be barredPthat although they havent received the goods, they already filed a provisional

claim. +he Court said$ that is not valid, you havent seen the goods, you havent received themand you filed a claim. 0n other words, your claim is speculative, that is not valid.

Jimenez Transcripts (Transportation and Public Service Law)Page 1! of 25


15/28

0f the goods are to be transshipped, the last carrier to deliver the goods shall be liable for eitherdamage or loss, even if that occurred while the goods were in the custody of a previous vessel.

Suppose the goods were imported from Napan. +hey were brought by Napanese vessel from

+oyo to Manila. +hen they were transshipped to Cebu by domestic shipping company,

Sweetlines. And the goods arrived in Cebu in a damaged condition, the consignee can run afterSweetlines even if the goods might have been damaged while in custody of that Napanese vessel.

+he recourse of Sweetlines is to run after that Napanese vessel for reimbursement.

+he carrier has a lien on the goods if the freight is not paid. 0f the freight is not yet paid, it must bepaid within 24 hours after their delivery. 0f there is delay in the payment, the carrier may as that

the goods be sold. nder the Civil Code, Article UUU, it is provided that the lien of the carrier is up to

3@ days.

i!ited i(ilit$

One of the basic principles in maritime commerce is the limited liability. +he hypothecary nature ofmaritime commerceTthis has been a principle of maritime commerce dating bac to ancient times

because of the ha;ards connected with maritime commerce. #ecause ha;ardous nature of maritimecommerce the liability of shipowners is limited to the vessel. 0f the vessel sins or he abandons it,

his liability is etinguished. >is liability is limited to the vessel and its value. And that limited liabilityapplies even to the shipping agent. +hat is why in a number of cases, the Court has said that were

the vessel san the liability of the owner is etinguished.

+he shipowner and the ship agent are liable under the law in certain instances1. for acts of the captain under Article 86


16/28

+hats why in thatA:oitiz case, where the vessel owned by Aboiti; shipping san but there was

insurance, the Court said$ the first consignee of the goods who was able to get a final udgment

cannot collect because there were other consignees who were still suing. So you have to waituntil all claims have been adudicated so that the claimants can be paid pro rata from the

proceeds of the insurance. #ecause if you allow the one who got the udgment first to collect, theothers might not be able to collect. And since they are all similarly situated, you have to wait

until all claims have been finally decided then you divide the money pro rata among all theclaimants who got a udgment in their favor.

3. +he Court has said that liabilities for repairs and provisioning the vessel, before their loss, is not

etinguished if the vessel sins.

0n this case where a 7ussian vessel was docing in the piers, they had a %ilipino harbor pilot, but

it became apparent that the vessel was going to ram against the pier. +he captain did nothing.+he Court said$ even if the vessel hired a harbor pilot while the vessel was docing, the captain

remains in command. +herefore, when it became apparent that a collision will occur, he shouldhave taen steps to prevent the collision, but he did nothing. +he master is liable, so the

shipowner would be liable for the damages to the pier.

Charter Part3#v. Artiles 65!e is the one who is liable to pay for the salaries of the crew. 0f there are repairs to bemade, he is the one who has to pay. On the other hand, if goods are lost the (inaudible will be

liable. "ow this was ased when C.N. :avide was the chairman$ what do you understand by thestatement that in a bareboat charter the charterer is owner pro ha vie. Pro ha viemeans )for

this occasion.* 0t means that during the duration of the bareboat charter, he will assume therights and liabilities of the shipowner. 0n a bare boat charter the vessel ceases to be a common

carrier, it becomes a private carrier. 0t is the charterer who will be liable to the holders of the

goods if the goods get lost. And since it is a private carrier, if the charterer does not pay theshipowner the stipulated fees, the shipowner cannot as that the cargoes be sold to satisfy his

claims because he has no lien on the goods. #ecause the one who is liable and who is dealing

with the owners of the goods is the charterer. +here is no privity of contract between theshipowner and the owners of the goods so he cannot as that the goods be sold to satisfy his

claim for his fees.

2. Ti!e Chrter$ 0t is a contract for the use of the vessel for a specified period or for the duration

of specified vessel.3. o$*e Chrteror Contrct of Affrei*ht!ent$ 0t is a contract for the carriage of goods from

one or more ports of loading to one or more ports of unloading.

0n +ime Charter and Doyage Charter, the shipowner remains in control of the vessel. So the vesselremains a common carrier. 0f goods are lost, it is the shipowner who will be liable.

+he charterer will usually be liable for deadfreight. !ie 0 had a case where the client (inaudible the

vessel to transport molasses he is selling to somebody in Napan. So the vessel arrived here. hen

Jimenez Transcripts (Transportation and Public Service Law)Page 1" of 25


17/28

they loaded the molasses, there was a shortage in the molasses. 0t was the fault of thewarehouseman. Anyway, so the shipowner filed a claim for deadfreightTwere there was shortage in

the molasses so that freight he could have earned was an opportunity lost. Hou have to mae goodthat amount because you agreed to load so many tons of molasses. +hat is deadfreight.

+he charterer will not be liable for the voyage if the delay in loading is due to fortuitous eventTe.g.,

the arrastre worers went on strieTthat is beyond the control of the charterer, he wont be liablefor the demurrage.

+he Court has said that in a bareboat charter of a private carrier, a stipulation there that the

shipowner will not be liable in case of loss and damage, the Court said since this is a private carrier,not a common carrier, that stipulation is valid. So the shipowner will not be liable for the loss of the

goods due to the negligence of the captain.

+he Court said that a stipulation in a voyage charter that the charterer will be liable for the loadingand unloading of the goods, while the owner will be liable for the care of the cargo during the

voyage, that is valid.

Don uan case. Don uan collided with a taner which Calte chartered to transport oil. UU

wanted to run after Calte because it had deeper pocets than the owner of the taner. +hetaner was at fault, it was navigating at nighttime without any lights. +he Court said$ "o,

because this was a voyage charter. And in a voyage charter, the taner remained a commoncarrier. +hus, Calte, the charterer, will not be liable. 0t will be the owner of the taner who will

remain liable. 0n one case, the shipowner (inaudible option$ either you claim the goods and pay the freight or

you abandon the goods. >e said$ 0 am abandoning the goods. Hou gave him the option toabandon the goods so you cannot claim anymore for freight.

+he goods may be deposited (inaudible (a if there are reasons to believe that freight will not be

paid or (b the consignee cannot be found or (c the consignee refuses to receive the goods. On the

other hand, the goods may be sold to pay for the freight, epenses and UU due the captain, to payfor freight under Article


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average. +here was no common danger because there was no danger that the vessel would sin.+he weather was fair, and the vessel simply got stranded on the shoals.

0n this case where fire broe out in the vessel. 0t has been burning for several days before they

discovered it. And now the vessel wants to declare a general average, and claim from the other

cargo owners. +he court said$ no, that is not general average. +hat is damage due to thenegligence of the crew.

C&llisi&ns #v. Artiles >!6"9, Co+e o2 Coere%

+he law lays down the rules for determining liability in case of collisions. !ie this provision lay downthe rules that govern collisions. +herefore the provisions of the Civil Code on &uasiJdelict are not

applicable. +his is a case of maritime tort governed by the provisions of the Code of Commerce and

not by the Civil Code. +he rules are laid down here.

Section 6(/ 5should be Article9 says if a vessel collides with another through the fault the captain or

crew, then the owner of the vessel at fault will answer for all damages. 0f both vessels are at fault,each one bears its own loss and they will be ointly and severally liable to the owners of the cargoes

of both vessels. +his is a special rule of maritime tort, you dont apply the Civil Code, even the lastclear chance rule. And one vessel cannot avoid liability by claiming that it has eercised diligence in

the selection and supervision of its crew. "either do you apply the principle of comparative fault andsay you were at greater fault, you should have a bigger share in damages. All those rules will be

irrelevant because these are special rules governing maritime commerce.

D&+trine &* Ins+ruta0le Fault.0f you cannot determine which vessel is at fault, each one bears itsown loss and the shipowners of the two vessels will be ointly and severally liable for the owners of

the cargoes of both vessels. +his is the doctrine of inscrutable fault. )0nscrutable,* you cannotdetermine. here two vessel collides and you cannot determine who is at fault, then each vessel

bears its own loss and the vessels will be ointly and severally liable for the owners of the cargoes ofboth vessels.

9mer-en+3 Rule.ere there are 3 UU. +he first UU when the vessels are near each other. +he

second is where collision is imminent. +he third UU is when collision is a certainty and actual impacttaes place. "ow, you apply the emergency rule if in a situation lie this, in the third UU, the one

who is privileged, that is, the vessel who has the right of way committed an error. 0f a person

eercising due diligence of reasonable man maes an error of udgment during an emergency and5inaudible9 has the right of way, he must be laible 5or not liable/ ".#. not sure about this, recordingrather inaudible9.

#ut in that case of Don uan. +he Court said$ both vessels were at fault because while one vessel

is at fault, the other one did not tae evasive action on time, well it too evasive action when

collision was already 5imminent9. 0t should have taen evasive action earlier. So they were bothat fault.

Dona Paz case. hile the boat was sining, the captain was playing mahong. >e did not tae

steps to try to delay the sining of the vessel. >e did not supervise the abandonment of the

vessel.

0f 2 vessels collide because of a fortuitous event, nobody is at fault, each one bears its own loss and

the cargo owners will also bear their own loss.

0f a third vessel who is at fault, causing 2 vessels to collide. Such third vessel will answer for

everythingTall losses and damages to the vessels and losses to the cargo owners.

!astly, if because of a fortuitous event, e.g. a typhoon, a vessel which is properly and safely mooredcollides with another, that is again a fortuitous event, each vessel will bear its own loss, the cargo

owners will bear their losses.

Jimenez Transcripts (Transportation and Public Service Law)Page 1$ of 25


19/28

Pr&test+here are 4 instances when a protest should be made$

1. hen there is a *enerl ver*e2. hen there is a shi#rec

3. hen there is a collision4. hen there is rrivl under stress

Of course, if the captain cannot mae the protest because of a fortuitous event, that is

ecusable. !ie he was inured and was in the hospital, so he is not in a condition to mae theprotest.

#ar. 6% 2""2 :anuar3

Sarmient&

ell, this idea of having a law that would regulate these public utilities is really vitiated by therailroad companies in the nited States in that they have to preserve their oligopoly so that no

newcomer could come in unless you could get a certificate of public convenience, and of course theywould oppose any new application.

"ow before, the ?ublic Service Commission (?SC regulated all the public utilities but after

Martial !aw, it was dissolved and its functions were parted out with different regulatory agencies co;

that commission had become notoriously corrupt because it was regulating properties worth billionsof pesos. So now you have different agencies regulating public utilities lie the !and +ransportation

%ranchising and 7egulatory #oard (!+%7#, although under the !ocal Government Code, the

regulation of the issuance of certificates of public convenience (C?C for tricycles has now beentransferred to the cities and municipalities. So the tricycle operators do not have to go to !+%7#,

they ust go to the cities and municipalities, thats where they apply. And for water transportation,you have the Maritime 0ndustry Authority (M0A, telecommunications you have the "ational

+elecommunications Commission ("+C, for the commercial aircrafts the Civil Aeronautics #oard(CA#, then the 'nergy 7egulatory #oard ('7#, the "ational ater 7esources Council ("7C.

Re*ultor$ *encies do not hve


20/28

"ow the law mentions that public utilities operated by the government or governmentJownedinstrumentalities are eempt from the law but they will be subect to regulation by the appropriate

agency and the fiing of the fares that they will charge the public.

Re0uire!ent of o(tinin* CERTI/ICATE O/ 6?IC CONENIENCE

So, to operate a public utility, one must have a certificate of public convenience.

And the court has said that as a rule, there is no need to get a legislative franchise becausethe legislature has delegated to the regulatory agencies to issue the authority to operate a public

utility. +hats why the court said Grand Air could operate a commercial operation service withoutneed of getting a legislative franchise. >owever, in the case of telecommunication companies,

Congress passed a special law providing that you need a legislative franchise to operate a telephonecompany.

6oers nd functions of the Re*ultor$ A*encies

1. Issuan+e &* +erti*i+ates &* pu0li+ +&nvenien+e

"ow the law says that these regulatory agencies have the power to issue certificates of

public convenience authori;ing the operation of public utilities. "ow, usually they have the power

to issue provisional authority. 0n CA#, they will usually grant first a provisional authority beforethey grant a regular certificate of public convenience.

7emember that the court has said that ownership of e&uipment used to operate a publicutility does not mae one a public utility lie that railway system along ':SA that is owned by a

foreign company but the owner is not the one transporting the passengers. 0ts the governmentwho is rendering services to the public because it is leasing the e&uipment and ownership of that

does not mae that corporation a public utility. 0n the same way that our airline companies aremerely leasing the airplanes theyre using from foreign companies.

0n the case of ?etron, the court said that it is not a public utility co; it was argued that the

?etroleum Act of 1B4B provides that refining of oil is a public utility. +he court said that refers to

domestically etracted oil and the oil that ?etron is refining is imported oil and ?etron is notrefining oil for someone to whom it will charge a fee. 0t is refining oil for itself. So it is not apublic utility.

So even if you get a legislative franchise, you still have to get a certificate of public

convenience from the regulatory agency in order to operate. "ow there is this old old law passedby the ?hilippine Commission authori;ing local governments to issue franchises in certain cases,

but you still have to get a certificate of public convenience.

"ow to *et certificte of #u(lic convenience, there are three re0uisites$1. +he applicant !ust (e /ili#ino citiFenor if its a corporation or partnership, it must be

organi;ed in the ?hilippines and must be at least


21/28

0ts not merely ferry service. 0t involves crossing the sea. 0t involves interJisland shipping. Soyou need a certificate of public convenience in transporting passengers between Sorsogon and

Samar.

"ow usually, the franchise given by the legislature provides that you cannot sell or disposeof that without the approval of the legislature. +hats why the court said, where somebody, a

radio company was given a certificate, a franchise and agreed with somebody else that they willoperate, the Crusader #roadcasting System (not so sure about the name, that they will operate

the radio company ointly, that is void. So the legislative franchise is peculiar to the grantee. 0tcannot as somebody to enoy those rights without the consent of Congress.

"ow you have that #rior o#ertor rule. 0t says that before you allow a new applicant to

come in, the prior operator should be allowed to epand his service provided that his service issatisfactory. +hat you should not allow a new applicant to come in if it will result in ruinous

competition. #ut the mere fact that the income of an eisting operator will be reduced does notmean that that is ruinous competition. Ruinous co!#etition means that because of the

competition, his income will be so reduced that it will not give him an ade&uate return on hisinvestment. #ut up to now 0 never saw anyone succeed in proving ruinous competition.

+here are e;+epti&ns t& this pri&r &perat&r rule?1. 0f the old operator operated less units that what he was authori;ed to operate. !ie a taicab

operator whos authori;ed to operate 2@ units but is only operating 1@. >e cannot evenoperate what he was authori;ed to operate. >e cannot obect to any new operators 5haay..

puro )operate* 9

2. 0f the old operator is opposing the application because there is no need, and if he does notrecogni;e that there is a need to epand his service then the prior operator rule does not

apply3. 0f the old operator did not apply to meet the increased demand until the new applicant came

in. 0n other words, you must always be alert, be ready to respond to the need of the publicfor epanded service. Hou only woe up when a new applicant came in. Hou cannot invoe

the prior operator rule.4. 0f the service is unsatisfactory.

8. 0f the old operator failed to increase his service although he was given the authority to do so.


22/28

law, the burden is on the applicant. And that regulation shifts the burden to the oppositor,therefore void.

!iewise, the regulation issued by the Sec. of +ransportation saying that operators of

provincial buses are allowed to adust the fare theyre charging up to 8@R more or 8@R lessthan what is authori;ed by the !+%7#, that is void. nder the law, the power to fi the rate is

with the #oard. +he effect of that regulation is to delegate the power to the bus companies. Sothat is not valid.

"ow the court has said, a customer who is suing Meralco, claiming that he is

overcharged, should be filed with the regular courts, not with the 'nergy 7egulatory #oardbecause the issue does not involve fiing of the rates to be charged the public. +he &uestion is

not about the rate to be charged. +he &uestion is whether he was overcharged. !iewise whena customer is asing for the basis of the computation for this power adustment, that is within

the urisdiction of the regular courts co; again it does not involve fiing of the power rates. 0f itsa &uestion of how to fi the rates, then its the 'nergy 7egulatory #oard which has urisdiction.

#ut this is ust asing how you arrived at that computation. So its the regular courts that have apower to do that.

?AR MATTER

"ow the court has said that even if aP this is the CeniF -G. cseand this was ased inthe #ar 'ams, even if a customer is contesting the bill of the public utility, they can disconnect

the service if he does not pay, otherwise the customer can compel the public utility to continue

rendering services by mere &uestioning the actual receipt of the bill.

And theres this old, old regulation issued by the defunct ?ublic Service Commission, hasbeen repealed, and it said that if a public utility will disconnect the service, it must give its

customer 46Jhour advance notice so he can pay. 0f he disconnects without prior notice, he isliable for damages.

And the court said, even if the meter was not tampered with but it is not correctly

registering the electric consumption, the customer is still liable to pay the correct amount.

7emember, that is in the Civil Code. 0f there is an error in accounting, you simply correct it.

0 remember when my uncle was still alive, 7affy 7ecto went to him. >e said that the

!ope;es of the Meralco would want my uncle to be an epert witness. My uncle said, )ell 0 willonly testify as a witness subect to certain conditions. %irst, 0 will chec your meter to find out if

its accurate or not. An then you cannot tell me what 0 will tell in court. 0t has to be the resultsof my findings. +hen secondly, 0 will not be paid. 0 dont want to be crossJeamined and be

ased )And how much were you paid to testify in court/* 7ecto said, )Oay.* So he eamined themeter. And it was running very slow, it is not registering correctly your consumption. So 7affy

7ecto did not present my uncle as a witness. Meralco instead presented him as a witness andsaid that yes, the meter was running too slow. And in court, he was ased what eplanation

does he give for this. ell there are many factors. 0t could be the factor defect in themanufacture of the meter, or because of wear and tear, the meter is no longer registering the

consumption, and of course, there is always the possibility of human intervention. My uncle said,he did not tell in court what was the possible cause, but he said, )+he way 0 eamined that

meter, most probably it was due to human intervention.*

"ow but in that 7adio (/ +ape and Chemical Corporation case, the court said that while it

is true that the meter did not register the consumption correctly, but Meralco did not discover it

after a long, long time and now suddenly they slapped the customer with their whopping bill.+he court said, because of that since you were also negligent, you did not discover the fact that



23/28

the meter was not registering consumption correctly, then the liability of the customer should bereduced. 0 thin they reduced it to 8@R.

"ow the court has fied 12R of the (UUU sum or return on investment of the public

utility. here did they get that 12R/ %rom old American decisions. Ang lai nung 12R return.And that is based on the cost, ha/ 0f you were to reconstruct the facilities being used by the

customer, lie a public utility servicing the public, of course you consider the present value, whatis the value today. +hats why you will notice that the ?ublic Service Commission adopted a

formula in 1B. Grant &r enial &* appli+ati&ns *&r e;pansi&n

+hen the court has said in that case of Dictory !iner which applied to epanded service, the

court said it earlier applied to suspend its operations because of lac of financial capability. Sothe court said that the application to epand should not be granted because of it earlier applied

to suspend its operations because of lac of financial capability.

?AR MATTER

+hen the court has said in the !agman case, that was ased in the #ar 'ams before,that the City of Manila can prohibit bus companies, provincial buses from entering their city. So

the provincial buses said that their certificate of public convenience says that Manila is their



24/28

destination, the effect of the ordinance is to amend the certificate of public convenience. +hecourt said "O co; under its charter Manila has control over its streets and therefore it has the

power to prohibit provincial buses from using the streets in Manila in order to reduce thevolume of traffic.

Mtters tht cn (e cted u#on ithout need of #rior herin*

"ow under Sec. 1F, there are certain matters which can be acted upon without need of prior

hearing.

1. Investi-ati&n &* an3 matter ithin its


25/28

. t& sell% alienate% m&rt-a-e &r en+um0er its pr&pert3% +erti*i+ate &* pu0li++&nvenien+e% et+.% you need prior approval

"ow even without approval, the contract is valid between the parties. #ut only

between them. And not with respect to the regulatory agency and the public. +hats why if apublic utility sold certain buses but the approval has not been approved yet, creditors of the

public utility can levy on the buses because the sale is valid only between the parties and notwith respect to the public and the regulatory agency.

?AR MATTER

ell in that Cohon (/ case which was ased in the #ar 'ams and Nustice >errera was

the eaminer, where the certificate of public convenience mentions the vessel to be operatedby the operator or shipping company and the vessel san, so a total loss, the court said the

vessel has become unseaworthy, it can no longer be operated. +he court said the certificateof public convenience cannot be sold because it attached and adhered to that vessel because

the certificate will specify the unit you will operate and that vessel is no longer seaworthy. Sothere is no subect matter of a valid sale.

H(it:S$ste!

And because of this @a:itsystem, the ostensible operator and the actual operator will besolidarily liable. a:itB sste, here is somebody with a certificate of public convenience to operate

lets say 2@ units. And then somebody now will operate a tai or eepney using that certificate of

public convenience. >e doesnt have one. >e will operate it in the name of the one who owns thecertificate of public convenience. "ow the court has said that they will be solidarily liable because if

we will uphold the liability of the actual operator and eempt the ostensible operator, this couldresult in collusion to the preudice of the public. +he one who has the certificate of public

convenience will allow someone who has no financial capability to operate using his certificate andthen if that is involved in an accident, he will disown any liability. +hey will be solidarily liable but

the ostensible operator can sue the actual operator for reimbursement.

>owever, the Supreme Court said in a decision penned by Nustice 'scolin that the actual

operator cannot sue the ostensible operator to recover the units because say he was operating taisusing the certificate of the actual operator. So the tais will be registered in the name of the ownerof the certificate of public convenience. 0f you chec with the !+O hes the owner. +he actual owner

sued the ostensible operator to get bac the vehicles. +he court said, this is an illegal agreement,and therefore you cannot sue the ostensible operator to recover the units which you illegally

registered in your name.

+hen to sell your shares of stocs of more than 4@R, you need the approval of theregulatory agency.

Crri*e of 4oods ($ the Se Act

+hen you have that COGSA. +his governsP well, the carriage of goods involves foreign or

international trade. >owever, the court has said that it is valid for the parties to stipulate that thiswill apply even if the contract will provide domestic carriage of goods. So theres nothing against

public policy to limit it to apply it to domestic carriage of goods.

The to !in fetures of this l re&

1. /he &ne3ear pres+riptive peri& t& *ile a +ase a-ainst the shippin- +&mpan32. /he limitati&n &* lia0ilit3 ?="" per pa+a-e.



26/28

"ow this COGSA applies up to the final port of destination even if there is transshipment by adomestic carrier. So if you have goods imported from Napan, transported by a Napanese vessel from

+oyo to Manila, and they were transshipped say by Sweet !ines from Manila to Cebu andsomewhere between Manila and Cebu, the goods were lost or damaged, COGSA will still apply co; it

applies up to the final port of destination.

Jimenez Transcripts (Transportation and Public Service Law)Page 2" of 25


27/28

Re@ ne3ear Pres+riptive Peri&

"ow as a rule you have to file a case within one year from the date the last item wasdelivered to the consignee. "ow if the goods were not delivered, then you count the oneJyear period

from the last day that delivery could have been made. So if the vessel stayed here for three daysand then it left, then you count from the last day that it stayed here. "ow the court has said that if

the goods were lost and the insurance company paid the consignee and now the insurance companyis suing, if the action had prescribed insofar as the consignee is concerned, that should also be

prescribed insofar as the insurance company is concerned co; it is merely subrogated to the rights ofthe consignee. So any defense that a person may raise against the consignee, lie prescription, then

that may also be raised against the insurance company. Co; the consignee can circumvent the oneJyear prescriptive period by simply asing the insurance company to pay on the ground that, anyway,

the oneJyear period will not apply to him. "o.

And the court has said that the oneJyear prescriptive period will not be suspended orinterrupted by maing a written demand. +hat provision in the Civil Code that the prescriptive

period will be interrupted by a written demand does not apply to the prescriptive period under theCOGSA co; it is the policy of the law that claims involving maritime commerce should be decided as

soon as possible.

>owever, there are also cases which are not covered by the oneJyear prescriptive period.

+his applies to delivery of lost or damaged goods or nonJdelivery. +his does not apply tomisdelivery. here the goods are delivered to the wrong person, that involves conversion of goods,

then what will apply will be the prescriptive period in the Civil Code, not the COGSA. +en years if

youre suing on the basis of a written contract, and four years if youre suing on the basis of a &uasiJdelict.

And you have this caseP the old Code of Civil ?rocedure contains provisions on prescription.

+hose provisions have not been repealed by the Civil Code co; the Civil Code says that theprovisions on prescription of the Code of Civil ?rocedure are repealed insofar as they are inconsistent

with the Civil Code. So provisions in the Code of Civil ?rocedure which are not inconsistent with theCivil Code are still applicable. "ow there is a provision in the Code of Civil ?rocedure that if a case

was filed and it was dismissed, you have one year from the dismissal to refile the case. "ow in the

old law, all admiralty cases irrespective of the amount were cogni;able by the Court of %irst0nstance. So if the amount is only ?1@@ you have to file that with C%0. "o what happened is thatthe case is filed with the City Court and because it was an admiralty case, filed under COGSA, it was

dismissed. +hen the case was refiled with the C%0, the court said that the action is not barred byprescription because in accordance with that provision in the Code of Civil ?rocedure where the case

was dismissed, that oneJyear period was revived or renewed.

And the court has also said that the parties may agree to etend the oneJyear prescriptiveperiod. A consignee filed a claim and the oneJyear period is about to epire. "ow the shipping

company tells the consignee, dont file a case yet co; we are still investigating, looing into yourclaim. So give us time. And they agreed to etend. +he court said that the parties can agree to

etend the oneJyear prescriptive period.

And the court also said that where the customs broer too the delivery of the goods of theconsignee and then the goods were lost in the course of the broer, the oneJyear prescriptive period

will no longer apply co; the one liable is the customs broer, not the shipping company.

!iewise, the court said that where the goods were delivered to the consignee but there was

delay, and because of that the goods were sold at a very low price. So the shipping company was

sued for the damages suffered because of the delay in the delivery. +he court said that the COGSAwill not apply co; this is not a case where the goods were lost or damaged. +his is a case of delay in

Jimenez Transcripts (Transportation and Public Service Law)Page 2# of 25


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the delivery of the goods. So this is not covered by COGSA and what will apply is the prescriptiveperiod in the Civil Code. So if based on a written contract, you have 1@ years to sue.

Re@ Bimitati&n in the Bia0ilit3 ?="" per pa+a-e

"ow the court has said that in computing the W8@@ per pacage, you refer to the cartons

inside the container van, it does not refer to the container van. +he value of the container van willbe worth millions, so you use the cartons inside that. +hat will be considered.

Go+ :less 4A

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