De Guzman v.

CA
Facts:
Respondent Ernesto Cendana was a junk dealer. He buys scrap materials and brings those that he
gathered to Manila for resale using 2 six-wheeler trucks. On the return trip to Pangasinan,
respondent would load his vehicle with cargo which various merchants wanted delivered, charging
fee lower than the commercial rates. Sometime in November 1970, petitioner Pedro de Guzman
contracted with respondent for the delivery of 750 cartons of Liberty Milk. On December 1, 1970,
respondent loaded the cargo. Only 150 boxes were delivered to petitioner because the truck carrying
the boxes was hijacked along the way. Petitioner commenced an action claiming the value of the lost
merchandise. Petitioner argues that respondent, being a common carrier, is bound to exercise
extraordinary diligence, which it failed to do. Private respondent denied that he was a common
carrier, and so he could not be held liable for force majeure. The trial court ruled against the
respondent, but such was reversed by the Court of Appeals.
Issues:
(1) Whether or not private respondent is a common carrier
(2) Whether private respondent is liable for the loss of the goods
Held:
(1) Article 1732 makes no distinction between one whose principal business activity is the carrying of
persons or goods or both, and one who does such carrying only as an ancillary activity. Article 1732
also carefully avoids making any distinction between a person or enterprise offering transportation
service on a regular or scheduled basis and one offering such service on an occasional, episodic or
unscheduled basis. Neither does Article 1732 distinguish between a carrier offering its services to the
"general public," i.e., the general community or population, and one who offers services or solicits
business only from a narrow segment of the general population. It appears to the Court that private
respondent is properly characterized as a common carrier even though he merely "back-hauled"
goods for other merchants from Manila to Pangasinan, although such backhauling was done on a
periodic or occasional rather than regular or scheduled manner, and even though private
respondent's principal occupation was not the carriage of goods for others. There is no dispute that
private respondent charged his customers a fee for hauling their goods; that fee frequently fell below
commercial freight rates is not relevant here. A certificate of public convenience is not a requisite for
the incurring of liability under the Civil Code provisions governing common carriers.
(2) Article 1734 establishes the general rule that common carriers are responsible for the loss,
destruction or deterioration of the goods which they carry, "unless the same is due to any of the
following causes only:
a. Flood, storm, earthquake, lightning, or other natural disaster or calamity;
b. Act of the public enemy in war, whether international or civil;
c. Act or omission of the shipper or owner of the goods;
d. The character of the goods or defects in the packing or in the containers; and
e. Order or act of competent public authority."
The hijacking of the carrier's truck - does not fall within any of the five (5) categories of exempting
causes listed in Article 1734. Private respondent as common carrier is presumed to have been at fault
or to have acted negligently. This presumption, however, may be overthrown by proof of
extraordinary diligence on the part of private respondent. We believe and so hold that the limits of
the duty of extraordinary diligence in the vigilance over the goods carried are reached where the
goods are lost as a result of a robbery which is attended by "grave or irresistible threat, violence or
force." we hold that the occurrence of the loss must reasonably be regarded as quite beyond the
control of the common carrier and properly regarded as a fortuitous event. It is necessary to recall
that even common carriers are not made absolute insurers against all risks of travel and of transport
of goods, and are not held liable for acts or events which cannot be foreseen or are inevitable,
provided that they shall have complied with the rigorous standard of extraordinary diligence.

NATIONAL DEVELOPMENT COMPANY vs. THE COURT OF APPEALS and DEVELOPMENT INSURANCE
AND SURETY CORPORATION
G.R. No. L-49407 19 August 1988
Facts:
National Development Company (NDC) appointed Maritime Company of the Philippines (MCP) as its
agent to manage and operate its vessel, ‘Dona Nati’, for and in behalf of its account. In 1964, while en
route to Japan from San Francisco, Dona Nati collided with a Japanese vessel, ‘SS Yasushima Maru’,
causing its cargo to be damaged and lost. The private respondent, as insurer to the consigners, paid
almost Php400,000.00 for said lost and damaged cargo. Hence, the private respondent instituted an
action to recover from NDC.
Issue:
Which laws govern the loss and destruction of goods due to collision of vessels outside Philippine
waters?
Ruling:
In a previously decided case, it was held that the law of the country to which the goods are to be
transported governs the liability of the common carrier in case of their loss, destruction or
deterioration pursuant to Article 1753 of the Civil Code. It is immaterial that the collision actually
occurred in foreign waters, such as Ise Bay, Japan.
It appears, however, that collision falls among matters not specifically regulated by the Civil Code,
hence, we apply Articles 826 to 839, Book Three of the Code of Commerce, which deal exclusively
with collision of vessels.

JOSE SANICO v. WERHERLINA P. COLIPANO

[ GR No. 209969, Sep 27, 2017 ]
Facts:
Colipano filed a complaint on January 7, 1997 for breach of contract of carriage and damages against
Sanico and Castro. In her complaint, Colipano claimed that at 4:00 P.M. more or less of December 25,
1993, Christmas Day, she and her daughter were; paying passengers in the jeepney operated by
Sanico, which was driven by Castro.Colipano claimed she was made to sit on an empty beer case at
the edge of the rear entrance/exit of the jeepney with her sleeping child on her lap. And, at an uphill
incline in the road to Natimao-an, Carmen, Cebu, the jeepney slid backwards because it did not have
the power to reach the top. Colipano pushed both her feet against the step board to prevent herself
and her child from being thrown out of the exit, but because the step board was wet, her left foot
slipped and got crushed between the step board and a coconut tree which the jeepney bumped,
causing the jeepney to stop its backward movement. Colipano's leg was badly injured and was
eventually amputated. Colipano prayed for actual damages, loss of income, moral damages,
exemplary damages, and attorney's fees.
In their answer, Sanico and Castro admitted that Colipano's leg was crushed and amputated but
claimed that it! was Colipano's fault that her leg was crushed. They admitted that the jeepney slid
backwards because the jeepney lost power. The conductor then instructed everyone not to panic but
Colipano tried to disembark and her foot got caught in between the step board and the coconut tree.
Sanico claimed that he paid for all the hospital and medical expenses of Colipano, and that Colipano
eventually freely and voluntarily executed an Affidavit of Desistance and Release of Claim.
After trial, the RTC found that Sanico and Castro breached the contract of carriage between them and
Colipano but only awarded actual and compensatory damages in favor of Colipano. The dispositive
portion of the RTC Decision states:
WHEREFORE, premises considered, this Court finds the defendants LIABLE for breach of contract of
carriage and are solidarily liable to pay plaintiff:
Actual damages in the amount of P2,098.80; and
Compensatory damages for loss of income in the amount of P360,000.00.
No costs.
SO ORDERED.
Only Sanico and Castro appealed to the CA, which affirmed with modification the RTC Decision. The
dispositive portion of the CA Decision states:
IN LIGHT OF ALL THE FOREGOING, the instant appeal is PARTIALLY GRANTED. The Decision dated
October 27, 2006 of the Regional Trial Court, Branch 25, Danao City, in Civil Case No. DNA-418, is
AFFIRMED with MODIFICATION in that the award for compensatory damages for loss of income in
paragraph 2 of the dispositive portion of the RTC's decision, is reduced to P200,000.00.
SO ORDERED.
Without moving for the reconsideration of the CA Decision, Sanico and Castro filed this petition
before the Court assailing the CA Decision.
Issue:
I. Whether the CA erred in finding that Sanico and Castro breached the contract of carriage with
Colipano;
II. Whether the Affidavit of Desistance and Release of Claim is binding on Colipano; and
III. Whether the CA erred in the amount of damages awarded.
Held:
I.
Only Sanico breached the contract of carriage.
it is beyond dispute that Colipano was injured while she was a passenger in the jeepney owned and
operated by Sanico that was being driven by Castro. Both the CA and RTC found Sanico and Castro
jointly and severally liable. This, however, is erroneous because only Sanico was the party to the
contract of carriage with Colipano.
Since the cause of action is based on a breach of a contract of carriage, the liability of Sanico is direct
as the contract is between him and Colipano. Castro, being merely the driver of Sanico's jeepney,
cannot be made liable as he is not a party to the contract of carriage.
Since Castro was not a party to the contract of carriage, Colipano had no cause of action against him
and the pomplaint against him should be dismissed. Although he was driving the jeepney, he was a
mere employee of Sanico, who was the operator and owner of the jeepney. The obligation to carry
Colipano safely to her destination was with Sanico. In fact, the elements of a contract of carriage
existeid between Colipano and Sanico: consent, as shown when Castro, as employee of Sanico,
accepted Colipano as a passenger when he allowed Colipano to board the jeepney, and as to
Colipano, when she boarded the jeepney; cause or consideration, when Colipano, for her part, paid
her fare; and, object, the transportation of Colipano from the place of departure to the place of
destination.
Sanico is liable as operator and owner of a common carrier. The CA also correctly held that the!
defense of engine failure, instead of exonerating Sanico, only aggravated his already precarious
position.[26] The engine failure "hinted lack of regular check and maintenance to ensure that the
engine is at its best, considering that the jeepney regularly passes through a mountainous area."
II.
The Affidavit of Desistance and Release of Claim is void.
The RTC ruled that "the Affidavit of Desistance and Release of Claim is not binding on plaintiff
[Colipano] in the absence of proof that the contents thereof were sufficiently translated and
explained to her."
For there to be a valid waiver, the following requisites are essential:
(1) that the person making the waiver possesses the right, (2) that he has the capacity and power to
dispose of the right, (3) that the waiver must be clear and unequivocal although it may be made
expressly or impliedly, and (4) that the waiver is not contrary to law, public policy, public order,
morals, good customs or prejudicial to a third person with a right recognized by law.[36]
While the first two requirements can be said to exist in this case, the third and fourth requirements
are, however, lacking.
Colipano could not have clearly and unequivocally waived her right to claim damages when she had
no understanding of the right she was waiving and the extent of that right. Worse, she was made to
sign a document written in a language she did not understand.
The fourth requirement for a valid waiver is also lacking as the waiver
III.
Amount of compensatory damages granted is incorrect
However, the CA erred when it used Colipano's age at the time she testified as basis for computing
the loss of earning capacity.[57] The loss of earning capacity commenced when Colipano's leg was
crushed on December 25, 1993. Given that Colipano was 30 years old when she testified on October
14, 1997, she was roughly 27 years old on December 25, 1993 when the injury was sustained.
Following the foregoing formula, the net earning capacity of Colipano is P212,000.00.
Sanico is liable to pay interest.
WHEREFORE, premises considered, the petition for review is hereby PARTLY GRANTED. As to
petitioner Vicente Castro, the Decision of the Court of Appeals dated September 30, 2013 is
REVERSED and SET ASIDE and the complaint against him is dismissed for lack of cause of action. As to
petitioner Jose Sanico, the Decision of the Court of Appeals is hereby AFFIRMED with
MODIFICATIONS, Petitioner Jose Sanico is liable and ordered to pay respondent Werherlina Colipano
the following amounts:
Actual damages in the amount of P2,098.80;
Compensatory damages for loss of income in the amount of P212,000.00;
Interest on the total amount of the damages awarded in 1 and 2 at the rate of 6% per annum
reckoned from October 27, 2006 until finality of this Decision.
The total amount of the foregoing shall, in turn, earn interest at the rate of 6% per annum from
finality of this Decision until full payment thereof.
SO ORDERED.
Alitalia v. IAC
Facts:
Dr. Felipa Pablo, an associate professor in the University of the Philippines and a research grantee of
the Philippine Atomic Energy Agency, was invited to take part at a meeting of the Department of
Research and Isotopes in Italy in view of her specialized knowledge in “foreign substances in food and
the agriculture environment”. She would be the second speaker on the first day of the meeting. Dr.
Pablo booked passage on petitioner Alitalia. She arrived in Milan on the day before the meeting, but
was told that her luggage was delayed and was in a succeeding flight from Rome to Milan. The
luggage included her materials for the presentation. The succeeding flights did not carry her luggage.
Desperate, she went to Rome to try to locate the luggage herself, but to no avail. She returned to
Manila without attending the meeting. She demanded reparation for the damages. She rejected
Alitalia’s offer of free airline tickets and commenced an action for damages. As it turned out, the
luggage was actually forwarded to Ispra, but only a day after the scheduled appearance. It was
returned to her after 11 months. The trial court ruled in favor of Dr. Pablo, and this was affirmed by
the Court of Appeals.
Issues:
(1) Whether the Warsaw Convention should be applied to limit Alitalia’s liability
(2) Whether Dr. Pablo is entitled to nominal damages
Held:
(1) Under the Warsaw Convention, an air carrier is made liable for damages for:
a. The death, wounding or other bodily injury of a passenger if the accident causing it took place on
board the aircraft or I the course of its operations of embarking or disembarking;
b. The destruction or loss of, or damage to, any registered luggage or goods, if the occurrence
causing it took place during the carriage by air; and
c. Delay in the transportation by air of passengers, luggage or goods.

The convention however denies to the carrier availment of the provisions which exclude or limit his
liability, if the damage is caused by his wilful misconduct, or by such default on his part as is
considered to be equivalent to wilful misconduct. The Convention does not thus operate as an
exclusive enumeration of the instances of an airline's liability, or as an absolute limit of the extent of
that liability. It should be deemed a limit of liability only in those cases where the cause of the death
or injury to person, or destruction, loss or damage to property or delay in its transport is not
attributable to or attended by any wilful misconduct, bad faith, recklessness, or otherwise improper
conduct on the part of any official or employee for which the carrier is responsible, and there is
otherwise no special or extraordinary form of resulting injury.
In the case at bar, no bad faith or otherwise improper conduct may be ascribed to the employees of
petitioner airline; and Dr. Pablo's luggage was eventually returned to her, belatedly, it is true, but
without appreciable damage. The fact is, nevertheless, that some species of injury was caused to Dr.
Pablo because petitioner ALITALIA misplaced her baggage and failed to deliver it to her at the time
appointed - a breach of its contract of carriage. Certainly, the compensation for the injury suffered by
Dr. Pablo cannot under the circumstances be restricted to that prescribed by the Warsaw Convention
for delay in the transport of baggage.
(2) She is not, of course, entitled to be compensated for loss or damage to her luggage. She is
however entitled to nominal damages which, as the law says, is adjudicated in order that a right of
the plaintiff, which has been violated or invaded by the defendant, may be vindicated and
recognized, and not for the purpose of indemnifying the plaintiff that for any loss suffered and this
Court agrees that the respondent Court of Appeals correctly set the amount thereof at PhP
40,000.00.
The Court also agrees that respondent Court of Appeals correctly awarded attorney’s fees to Dr.
Pablo and the amount of PhP 5,000.00 set by it is reasonable in the premises. The law authorizes
recovery of attorney’s fees inter alia where, as here, the defendant’s act or omission has compelled
the plaintiff to litigate with third persons or to incur expenses to protect his interest or where the
court deems it just and equitable.