Compiled Chapter 3 Cases

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<ul><li><p>8/13/2019 Compiled Chapter 3 Cases</p><p> 1/23</p><p>1</p><p>GRATUITOUS PASSENGER</p><p>G.R. No. L-9907 June 30, 1958</p><p>LOURDES J. LARA, ET AL.,plaintiffs-appellants,vs.</p><p>BRIGIDO R. VALENCIA,defendant-appellant.</p><p>FACTS:</p><p>This is an action for damages brought by plaintiffs against defendant in the Court of First Instance ofDavao for the death of one Demetrio Lara, Sr. allegedly caused by the negligent act of defendant. Defendantdenied the charge of negligence and set up certain affirmative defenses and a counterclaim.</p><p>The deceased was an inspector of the Bureau of Forestry stationed in Davao with an annual salary ofP1,800. The defendant is engaged in the business of exporting logs from his lumber concession in Cotabato.Lara went to said concession upon instructions of his chief to classify the logs of defendant which were aboutto be loaded on a ship anchored in the port of Parang. The work Lara of lasted for six days during which he</p><p>contracted malaria fever. In the morning of January 9, 1954, Lara who then in a hurry to return to Davaoasked defendant if he could take him in his pick-up as there was then no other means of transportation, towhich defendant agreed, and in that same morning the pick-up left Parang bound for Davao taking along sixpassengers, including Lara.</p><p>Before leaving Parang, the sitting arrangement was as follows: defendant was at the wheel andseated with him in the front seat were Mrs. Valencia and Nicanor Quinain; on the back of the pick-up weretwo improvised benches placed on each side, and seated on the right bench were Ricardo Alojipan andAntonio Lagahit, and on the left one Bernardo and Pastor Geronimo. A person by the name of Leoning wasseated on a box located on the left side while in the middle Lara sat on a bag. Before leaving Parang, defendantinvited Lara to sit with him on the front seat but Lara declined. It was their understanding that upon reachingbarrio Samoay, Cotabato, the passengers were to alight and take a bus bound for Davao, but when theyarrived at that place, only Bernardo alighted and the other passengers requested defendant to allow them to</p><p>ride with him up to Davao because there was then no available bus that they could take in going to that place.Defendant again accommodated the passengers.</p><p>When they continued their trip, the sitting arrangement of the passengers remained the same, Larabeing seated on a bag in the middle with his arms on a suitcase and his head cove red by a jacket. Uponreaching Km. 96, barrio Catidtuan, Lara accidentally fell from the pick-up and as a result he suffered seriousinjuries. Valencia stopped the pick-up to see what happened to Lara. He sought the help of the residents ofthat place and applied water to Lara but to no avail. They brought Lara to the nearest place where they couldfind a doctor and not having found any they took him to St. Joseph's Clinic of Kidapawan. But when Laraarrived he was already dead. From there they proceeded to Davao City and immediately notified the localauthorities. An investigation was made regarding the circumstances surrounding the death of Lara but nocriminal action was taken against defendant.</p><p>Defendant merely accommodated them and did not charge them any fee for the service.</p><p>ISSUE: Whether or not the defendant should observe the requirement of extraordinary diligence intransporting the deceased from Parang to Davao on the date in question.</p><p>HELD:No. Defendant need observe that degree of diligence. It therefore appears that the deceased, as well hiscompanions who rode in the pick-up of defendant, were merely accommodation passengers who paid nothingfor the service and so they can be considered as invited guests within the meaning of the law. Asaccommodation passengers or invited guests, defendant as owner and driver of the pick-up owes to them</p></li><li><p>8/13/2019 Compiled Chapter 3 Cases</p><p> 2/23</p><p>2</p><p>merely the duty to exercise reasonable care so that they may be transported safely to their destination. Thus,"The rule is established by the weight of authority that the owner or operator of an automobile owes the dutyto an invited guestto exercise reasonable care in its operation, and not unreasonably to expose him to dangerand injury by increasing the hazard of travel. Since one riding in an automobile is no less a guest because heasked for the privilege of doing so, the same obligation of care is imposed upon the driver as in the case of oneexpressly invited to ride" (5 Am. Jur., 626-627). Defendant, therefore, is only required to observe ordinary</p><p>care, and is not in duty bound to exercise extraordinary diligence as required of a common carrier by our law.</p><p>Even if we admit as true the facts found by the trial court, still we find that the same are not sufficientto show that defendant has failed to take the precaution necessary to conduct his passengers safely to theirplace of destination for there is nothing there to indicate that defendant has acted with negligence or withouttaking the precaution that an ordinary prudent man would have taken under similar circumstances.</p><p>It should also be noted that defendant was not in duty bound to take the deceased in his own pick-upto Davao because from Parang to Cotabato there was a line of transportation that regularly makes trips forthe public, and if defendant agreed to take the deceased in his own car, it was only to accommodate himconsidering his feverish condition and his request that he be so accommodated. It should also be noted thatthe passengers who rode in the pick-up of defendant took their respective seats therein at their own choiceand not upon indication of defendant with the particularity that defendant invited the deceased to sit with him</p><p>in the front seat but which invitation the deceased declined. All the circumstances therefore clearly indicatethat defendant had done what a reasonable prudent man would have done under the circumstances.</p><p>The law also provides that "A passenger must observe the diligence of a good father of a family toavoid injury to himself" (Article 1761, new Civil Code), which means that if the injury to the passenger hasbeenproximatelycaused by his own negligence, the carrier cannot be held liable. All things considered, weare persuaded to conclude that the accident occurred not due to the negligence of defendant but tocircumstances beyond his control and so he should be exempt from liability.</p><p>DELSAN TRANSPORT LINES, INC. vs COURT OF APPEALS and AMERICAN HOME ASSURANCECORPORATION</p><p> Caltex Philippines entered into a contract of affreightment with Delsan Transport Lines, Inc., for aperiod of one year whereby the said common carrier agreed to transport Caltexs industrial fuel oilfrom the Batangas-Bataan Refinery to different parts of the country.</p><p> Under the contract, petitioner took on board its vessel, MT Maysun, 2,277.314 kiloliters of industrialfuel oil of Caltex to be delivered to the Caltex Oil Terminal in Zamboanga City. The shipment wasinsured with the private respondent, American Home Assurance Corporation.</p><p> On August 14, 1986, MT Maysun set sail from Batangas for Zamboanga City. Unfortunately, the vesselsank in the early morning of August 16, 1986 near Panay Gulf in the Visayas taking with it the entire</p><p>cargo of fuel oil.</p><p> Subsequently, private respondent paid Caltex the sum of Five Million Ninety-Six Thousand SixHundred Thirty-Five Pesos and Fifty-Seven Centavos (P5,096,635.57) representing the insured valueof the lost cargo. Exercising its right of subrogation under Article 2207 of the New Civil Code, theprivate respondent demanded of the petitioner the same amount it paid to Caltex.</p><p> Due to its failure to collect from the petitioner despite prior demand, private respondent filed acomplaint with the Regional Trial Court of Makati City, Branch 137, for collection of a sum of money.</p><p> After the trial and upon analyzing the evidence adduced, the trial court rendered a decision onNovember 29, 1990 dismissing the complaint against herein petitioner without pronouncement as tocost. The decision of the trial court, however, was reversed, on appeal, by the Court of Appeals. Theappellate court ruled that the petitioner is liable on its obligation as common carrier to herein privaterespondent insurance company as subrogee of Caltex.</p><p>Issue:</p></li><li><p>8/13/2019 Compiled Chapter 3 Cases</p><p> 3/23</p><p>3</p><p>Whether or not the payment made by the private respondent to Caltex for the insured value of the lost cargoamounted to an admission that the vessel was seaworthy, thus precluding any action for recovery against thepetitioner.</p><p>Held:</p><p>No. The payment made by the private respondent for the insured value of the lost cargo operates as</p><p>waiver of its (private respondent) right to enforce the term of the implied warranty against Caltex under themarine insurance policy. However, the same cannot be validly interpreted as an automatic admission of thevessels seaworthiness by the private respondent as to foreclose recourse against the petitioner for anyliability under its contractual obligation as a common carrier. The fact of payment grants the privaterespondent subrogatory right which enables it to exercise legal remedies that would otherwise be availableto Caltex as owner of the lost cargo against the petitioner common carrier. Article 2207 of the New Civil Codeprovides that:</p><p>Art. 2207. If the plaintiffs property has been insured, and he has received indemnity from the insurancecompany for the injury or loss arising out of the wrong or breach of contract complained of, the insurance</p><p>company shall be subrogated to the rights of the insured against the wrongdoer or the person who has violated</p><p>the contract. If the amount paid by the insurance company does not fully cover the injury or loss, the aggrieved</p><p>party shall be entitled to recover the deficiency from the person causing the loss or injury.</p><p>The payment made by the private respondent (insurer) to Caltex (assured) operates as an equitableassignment to the former of all the remedies which the latter may have against the petitioner.</p><p>In order to escape liability for the loss of its cargo of industrial fuel oil belonging to Caltex, petitionerattributes the sinking of MT Maysun to fortuitous event or force majeure. From the testimonies of JaimeJarabe and Francisco Berina, captain and chief mate, respectively of the ill-fated vessel, it appears that asudden and unexpected change of weather condition occurred in the early morning of August 16, 1986; thatat around 3:15 oclock in the morning a squall (unos) carrying strong winds with an approximate velocity of30 knots per hour and big waves averaging eighteen (18) to twenty (20) feet high, repeatedly buffeted MTMaysun causing it to tilt, take in water and eventually sink with its cargo. This tale of strong winds and bigwaves by the said officers of the petitioner however, was effectively rebutted and belied by the weatherreport from the Philippine Atmospheric, Geophysical and Astronomical Services Administration (PAGASA),the independent government agency charged with monitoring weather and sea conditions, showing that from</p><p>2:00 oclock to 8:00 oclock in the morning on August 16, 1986, the wind speed remained at ten (10) totwenty (20) knots per hour while the height of the waves ranged from .7 to two (2) meters in the vicinity ofCuyo East Pass and Panay Gulf where the subject vessel sank. Thus, as the appellate court correctly ruled,petitioners vessel, MT Maysun, sank with its entire cargo for the reason that it was not seaworthy. There wasno squall or bad weather or extremely poor sea condition in the vicinity when the said vessel sank.</p><p>The appellate court also correctly opined that the petitioners witnesses, Jaime Jarabe and FranciscoBerina, ship captain and chief mate, respectively, of the said vessel, could not be expected to testify againstthe interest of their employer, the herein petitioner common carrier.</p><p>Neither may petitioner escape liability by presenting in evidence certificates that tend to show that atthe time of dry-docking and inspection by the Philippine Coast Guard, the vessel MT Maysun, was fit forvoyage. These pieces of evidence do not necessarily take into account the actual condition of the vessel at thetime of the commencement of the voyage.</p><p>Additionally, the exoneration of MT Maysuns officers and crew by the Board of Marine Inquiry merelyconcerns their respective administrative liabilities. It does not in any way operate to absolve the petitionercommon carrier from its civil liability arising from its failure to observe extraordinary diligence in thevigilance over the goods it was transporting and for the negligent acts or omissions of its employees, thedetermination of which properly belongs to the courts. In the case at bar, petitioner is liable for the insuredvalue of the lost cargo of industrial fuel oil belonging to Caltex for its failure to rebut the presumption of faultor negligence as common carrier occasioned by the unexplained sinking of its vessel, MT Maysun, while intransit.</p></li><li><p>8/13/2019 Compiled Chapter 3 Cases</p><p> 4/23</p><p>4</p><p>CALTEX (PHILIPPINES), INC. v. SULPICIO LINES, INC., GO SIOC SO, ENRIQUE S. GO, EUSEBIO S. GO,CARLOS S. GO, VICTORIANO S. GO, DOMINADOR S. GO, RICARDO S. GO, EDWARD S. GO, ARTURO S. GO,EDGAR S. GO, EDMUND S. GO, FRANCISCO SORIANO, VECTOR SHIPPING CORPORATION, TERESITA G.</p><p>CAEZAL AND SOTERA E. CAEZAL</p><p> MT Vector is a tramping motor tanker owned and operated by Vector Shipping Corporation, engagedin the business of transporting fuel products such as gasoline, kerosene, diesel and crude oil. Duringthat particular voyage, the MT Vector carried on board gasoline and other oil products owned byCaltex by virtue of a charter contract between them. While MV Doa Paz is a passenger and cargovessel owned and operated by Sulpicio Lines, Inc. plying the route of Manila/ Tacloban/ Catbalogan/Manila/ Catbalogan/ Tacloban/ Manila, making trips twice a week.</p><p> On December 19, 1987, motor tanker MT Vector left Limay, Bataan, enroute to Masbate, loaded with8,800 barrels of petroleum products shipped by petitioner Caltex. On December 20, 1987, thepassenger ship MV Dona Paz left the port of Tacloban headed for Manila with a complement of 59crew members including the master and his officers, and passengers totaling 1,493 as indicated inthe Coast Guard Clearance.</p><p> At about 10:30 p.m. of December 20, 1987, the two vessels collided in the open sea within the vicinityof Dumali Point between Marinduque and Oriental Mindoro. All the crewmembers of MV Doa Pazdied, while the two survivors from MT Vector claimed that they were sleeping at the time of the</p><p>incident. The MV Doa Paz carried an estimated 4,000 passengers; many indeed, were not in the passenger</p><p>manifest. Only 24 survived the tragedy after having been rescued from the burning waters by vesselsthat responded to distress calls. Among those who perished were public school teacher SebastianCaezal (47 years old) and his daughter Corazon Caezal (11 years old), both unmanifested passengersbut proved to be on board the vessel.</p><p> On March 22, 1988, the board...</p></li></ul>