Transportation Law Prelims

First of all, if you haven't read the digests, please feel free to browse them at the following links:

Dangwa Transportation

Japan Airlines V. Asuncion

I actually did not finish digesting all the required cases but if you're interested to browse other case digests in transportation law, please visit arellanolaw.net. You can find about 200 case digests concerning Transportation Law.

Ok, let's begin.

Contract of Transportation - a contract whereby a person obligates himself to transport persons or property from one place to another for a consideration. It may involve either the carriage of goods or carriage of passengers. The person who obligates to transport the goods or passengers may be a private carrier or common carrier.

Perfection of the contract.
There are actually two types of contract involved in here:

1. Contract to carry - perfected by mere consent
2. Contract of carriage (or of common carriage) - perfected once the passenger has already purchased a ticket and boarded the carrier (in case of airplanes and trains), attempted to board the conveyances (in cases of buses, jeepneys, taxi), or once the goods are unconditionally placed in the possession and control of the carrier

What are common carriers?
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. They are public utilities impressed with public interest and concern.

Tests in determining whether a a party is a common carrier:

1. He must be engaged and holds himself out as ready to engage in the business of carrying goods for others as a public employment;
2. He must undertake to carry goods of the kind to which his business is confined;
3. He must undertake to carry by the method by which his business is conducted and over his established roads;
4. The transportation must be for hire.
   

Characteristics of common carriers:

1. carrying of persons or goods or both may be the principal business activity or merely an ancillary activity;
2. transportation service may be offered on a regular, scheduled, occasional, episodic, or unscheduled basis;
3. the services may be offered to the general public or only to a narrow segment of the general population;
4. with or without a Certificate of Public Convenience;
5. no distinction as to means of transporting, as long as it is by land, water or air;
6. it does not only have to be transportation by motor vehicle;
7. a common carrier may have no fixed or publicly known route, maintains no terminal, and doesn't issue tickets;
8. a person or entity need not be engaged in the business of public transportation for the provisions of the Civil Code on common carriers to apply to them.

Effect of Charter Party
A charter party may transform a common carrier into a private carrier in case of a bareboat or demise charter where the charterer mans the vessel with its own people and becomes, in effect, the owner for the voyage or service stipulated.


Towage - where one vessel is hired to bring another vessel to another place
Arrastre - receive, handle, care for and deliver merchandise passing through ports
Stevedoring - loading and unloading of coastwise vessels calling at the port

GOVERNING LAWS (sus, kung si Manriquez pa atong professor sigurado ko mugawas jud ni!)

1. Code of Commerce and other special laws
2. Law of the country of destination applies
3. Warsaw Convention (Convention for the Unification of Certain Rules Relating to the International Carriage by Air

Summary of Rules:

1. Coastwise Shipping
• New Civil Code (Art. 1732-1766) - primary law
• Code of commerce - suppletorily
2. Carriage from Foreign Ports to Philippine Ports
• New Civil Code - primary law
• Code of Commerce - all matters not regulated bu the Civil Code
• Carriage of Goods by Sea Act (COGSA) - suppletorily to the Civil Code
3. Carriage from Philippine Ports to Foreign Ports
• The laws of the country to which the goods are to be transported
4. Overland Transport
• Civil Code - primary
• Code of Commerce - suppletorily
5. Air Transportation
• Civil Code
• Code of Commerce
• For International Carriage - COGSA, as amended

I AM SICK! DI NAKO MAG-UPDATE.. TULOG SAKO! 12/21/07

Japan Airlines V. Asuncion (G.R No. 161730, January 28,2005) 449 SCRA 544

Digested by Ms. Karen Mae Gonzales

FACTS:
This petition for review seeks to reverse and set aside the October 9, 2002 decision of the Court of Appeals and its January 12, 2004 resolution, which affirmed in toto the June 10, 1997 decision of the Regional Trial Court of Makati City, Branch 61 in Civil Case No. 92-3635.
On March 27, 1992, respondents Michael and Jeanette Asuncion left Manila on board Japan Airlines’ (JAL) Flight 742 bound for Los Angeles. Their itinerary included a stop-over in Narita and an overnight stay at Hotel Nikko Narita. Upon arrival at Narita, Mrs. Noriko Etou-Higuchi of JAL endorsed their applications for shore pass and directed them to the Japanese immigration official. A shore pass is required of a foreigner aboard a vessel or aircraft who desires to stay in the neighborhood of the port of call for not more than 72 hours.
During their interview, the Japanese immigration official noted that Michael appeared shorter than his height as indicated in his passport. Because of this inconsistency, respondents were denied shore pass entries and were brought instead to the Narita Airport Rest House where they were billeted overnight.
Mr. Atsushi Takemoto of the International Service Center (ISC), the agency tasked by Japan’s Immigration Department to handle passengers who were denied shore pass entries, brought respondents to the Narita Airport Rest House where they stayed overnight until their departure the following day for Los Angeles. Respondents were charged US$400.00 each for their accommodation, security service and meals.

On December 12, 1992, respondents filed a complaint for damages claiming that JAL did not fully apprise them of their travel requirements and that they were rudely and forcibly detained at Narita Airport.


Issue: Whether or not JAL is liable of breach of contract of carriage.

Side Issues:
• Whether or not JAL is liable for moral, exemplary damages,
• Whether or not the plaintiff is liable for attorney’s fee and cost of suit incurred (JAL counterclaim)

Ruling:

The court finds that JAL did not breach its contract of carriage with respondents. It may be true that JAL has the duty to inspect whether its passengers have the necessary travel documents, however, such duty does not extend to checking the veracity of every entry in these documents. JAL could not vouch for the authenticity of a passport and the correctness of the entries therein. The power to admit or not an alien into the country is a sovereign act which cannot be interfered with even by JAL. This is not within the ambit of the contract of carriage entered into by JAL and herein respondents. As such, JAL should not be faulted for the denial of respondents’ shore pass applications.

In the Respondents claim that petitioner breached its contract of carriage when it failed to explain to the immigration authorities that they had overnight vouchers at the Hotel Nikko Narita. They imputed that JAL did not exhaust all means to prevent the denial of their shore pass entry applications. JAL or any of its representatives have no authority to interfere with or influence the immigration authorities. The most that could be expected of JAL is to endorse respondents’ applications, which Mrs. Higuchi did immediately upon their arrival in Narita.

Moral damages may be recovered in cases where one willfully causes injury to property, or in cases of breach of contract where the other party acts fraudulently or in bad faith. Exemplary damages are imposed by way of example or correction for the public good, when the party to a contract acts in wanton, fraudulent, oppressive or malevolent manner. Attorney’s fees are allowed when exemplary damages are awarded and when the party to a suit is compelled to incur expenses to protect his interest.[17] There being no breach of contract nor proof that JAL acted in wanton, fraudulent or malevolent manner, there is no basis for the award of any form of damages.

Neither should JAL be held liable to reimburse respondents the amount of US$800.00. It has been sufficiently proven that the amount pertained to ISC, an agency separate and distinct from JAL, in payment for the accommodations provided to respondents. The payments did not in any manner accrue to the benefit of JAL.

However, we find that the Court of Appeals correctly dismissed JAL’s counterclaim for litigation expenses, exemplary damages and attorney’s fees. The action was filed by respondents in utmost good faith and not manifestly frivolous. Respondents honestly believed that JAL breached its contract. A person’s right to litigate should not be penalized by holding him liable for damages. This is especially true when the filing of the case is to enforce what he believes to be his rightful claim against another although found to be erroneous.[

WHEREFORE, in view of the foregoing, the instant petition is PARTLY GRANTED. The October 9, 2002 decision of the Court of Appeals and its January 12, 2004 resolution in CA-G.R. CV No. 57440, are REVERSED and SET ASIDE insofar as the finding of breach on the part of petitioner and the award of damages, attorney’s fees and costs of the suit in favor of respondents is concerned. Accordingly, there being no breach of contract on the part of petitioner, the award of actual, moral and exemplary damages, as well as attorney’s fees and costs of the suit in favor of respondents Michael and Jeanette Asuncion, is DELETED for lack of basis. However, the dismissal for lack of merit of petitioner’s counterclaim for litigation expenses, exemplary damages and attorney’s fees, is SUSTAINED. No pronouncement as to costs

Dangwa Transportation Co. vs Court of Appeals GR No. 95582 October 1991

Facts:
On March 25, 1985, Pedrito Cudiamat was ran over by a bus operated by Dangwa Transportation Company, and driven by Theodore Lardizabal. Lardizabal, being reckless and negligent, has prematurely stepped on the accelerator of the bus just as when Cudiamat boarded the same. The sudden jerk movement caused Cudiamat to fall from the platform and was ran over by they bus. Moreover, the driver did not immediately brought the victim to the nearest hospital for medical attention.

Issue:
Whether or not the driver and bus company are liable for the death of P. Cudiamat.

Held:
They are liable.

Common carriers, from the nature of their business and reasons of public policy, are bound to observe extraordinary diligence for the safety of the passengers transported by the according to all the circumstances of each case. A common carrier is bound to carry the passengers safely as far as human care and foresight can provide, using the utmost diligence very cautious persons, with a due regard for all the circumstances.

It has also been repeatedly held that in an action based on a contract of carriage, the court need not make an express finding of fault or negligence on the part of the carrier in order to hold it responsible to pay the damages sought by the passenger. By contract of carriage, the carrier assumes the express obligation to transport the passenger to his destination safely and observe extraordinary diligence with a due regard for all the circumstances, and any injury that might be suffered by the passenger is right away attributable to the fault or negligence of the carrier. This is an exception to the general rule that negligence must be proved, and it is therefore incumbent upon the carrier to prove that it has exercised extraordinary diligence as prescribed in Articles 1733 and 1755 of the Civil Code.