1. Mirasol v. The Robert Dollar Co.

  never intended to ratify or confirm any agreement to limit the liability of the
G.R. No. L-29721. March 27, 1929 defendant.
TOPIC: Rationale for the presumption 
 When the other case was found, plaintiff filed a claim for the real damage of
the books therein named in the sum of $375.
1. WHEN SHIPPER IS NOT BOUND. — Where it appears that a bill of lading
was issued to a shipper containing a clause limiting the carrier’s liability, printed in  DEFENDANT’s CONTENTIONS: 
fine letters on the back of the bill of lading, which he did not sign and of which he
was not advised, in an action for damages, the shipper is not bound by the clause o The steamship President Garfield at all the times alleged was in all
which limits the carrier’s liability. respects seaworthy and properly manned, equipped and supplied, and
fit for the voyage. 
2. WHEN BURDEN OF PROOF IS SHIFTED. — Shippers who are forced to ship
goods on an ocean liner, have some legal rights, and when goods are delivered on
o That the damage to plaintiff's merchandise, if any, was not caused
board ship in good order and condition, and the shipowner delivers them to the
through the negligence of the vessel, its master, agent, officers, crew,
shipper in bad order and condition, in an action for damages, the burden of proof is
tackle or appurtenances, nor by reason of the vessel being
then shifted, and it devolves upon the shipowner to both allege and prove that the
unseaworthy or improperly manned, "but that such damage, if any,
goods were damaged by reason of some act which legally exempts him from liability.
resulted from faults or errors in navigation or in the management of
3. REASON FOR RULE. — As to when and how goods were damaged in transit is said vessel." 
a matter peculiarly within the knowledge of the shipowner and his employees, and to
require the plaintiff to prove as to when and how the damage was done would force o The bill of lading issued by the defendant to plaintiff, it was agreed
him to rely upon the employees of the defendant’s ship which in legal effect would in writing that defendant should not be "held liable for any loss of, or
be to say that he cannot recover damages for any reason. damage to, any of said merchandise resulting from any of the
following causes, to wit: Acts of God, perils of the sea or other
FACTS:  waters," and that plaintiff's damage, if any, was caused by "Acts of
 Plaintiff alleges that he is the owner and consignee of two cases of books, God" or "perils of the sea." The damage, if any, was caused by "sea
shipped in good order and condition at New York, U.S.A., on board the water," and that the bill of lading exempts the defendant from
defendant's steamship President Garfield, for transport and delivery to the liability for that cause. That damage by "seawater" is a shipper's risk,
plaintiff in the City of Manila, all freight charges paid and arrived in Manila and that defendant is not liable. 
in bad order and damaged condition, resulting in the total loss of one case
and a partial loss of the other.  Issue:
 Defendant has refused and neglected to pay, giving as its reason that the Whether or not defendant Dollar is liable. (YES)
damage in question "was caused by sea water." Plaintiff never entered into
any contract with the defendant limiting the defendant's liability as a
common carrier, and when he wrote the letter, he had not then ascertained the Ruling:
contents of the damaged case, and could not determine their value. That he
The defendant having received the two boxes in good condition, its legal
duty was to deliver them to the plaintiff in the same condition in which it received
them. From the time of their delivery to the defendant in New York until they are stranding or the perils of the sea, that would be a matter exclusively within the
delivered to the plaintiff in Manila, the boxes were under the control and supervision knowledge of the officers of defendant's ship, and in the very nature of things would
of the defendant and beyond the control of the plaintiff. The defendant having not be within plaintiff's knowledge, and upon all of such questions, there is a failure
admitted that the boxes were damaged while in transit and in its possession, the of proof.
burden of proof then shifted, and it devolved upon the defendant to both allege and
prove that the damage was caused by reason of some fact which exempted it from
liability. As to how the boxes were damaged, when or where, was a matter peculiarly
and exclusively within the knowledge of the defendant and in the very nature of DISPOSITIVE: The judgment of the lower court will be modified, so as to give the
things could not be in the knowledge of the plaintiff. To require the plaintiff to prove plaintiff legal interest on the amount of his judgment from the date of its rendition in
as to when and how the damage was caused would force him to call and rely upon the the lower court, and in all respects affirmed, with costs. So ordered.
employees of the defendant's ship, which in legal effect would be to say that he could
not recover any damage for any reason. That is not the law. NOTES:
Shippers who are forced to ship goods on an ocean liner or any other ship Plaintiff's contention that he is entitled to P700 for his Encyclopedia Britannica is not
have some legal rights, and when goods are delivered on board ship in good order tenable. The evidence shows that the P400 that the court allowed, he could buy a new
and condition, and the shipowner delivers them to the shipper in bad order and set which could contain all of the material and the subject matter of the one which he
condition, it then devolves upon the shipowner to both allege and prove that the lost. Plaintiff's third assignment of error is well taken, as under all of the authorities,
goods were damaged by the reason of some fact which legally exempts him from he is entitled to legal interest from the date of his judgement rendered in the lower
liability; otherwise, the shipper would be left without any redress, no matter what court and not the date when it becomes final. The lower court found that plaintiff's
may have caused the damage. damage was P2,080, and that finding is sustained by that evidence. There was a total
The fact that the cases were damaged by "sea water," standing alone and loss of one case and a partial loss of the other, and in the very nature of the things,
within itself, is not evidence that they were damaged by force majeure or for a cause plaintiff could not prove his loss in any other way or manner that he did prove it, and
beyond the defendant's control. The words "perils of the sea," as stated in defendant's the trial court who heard him testify must have been convinced of the truth of his
brief apply to "all kinds of marine casualties, such as shipwreck, foundering, testimony.
stranding," and among other things, it is said: "Tempest, rocks, shoals, icebergs and There is no claim or pretense that the plaintiff signed the bill of lading or that he
other obstacles are within the expression," and "where the peril is the proximate knew of his contents at the time that it was issued. In that situation he was not legally
cause of the loss, the shipowner is excused." "Something fortuitous and out of the bound by the clause which purports to limit defendant's liability. That question was
ordinary course is involved in both words 'peril' or 'accident'." squarely met and decided by this court in banc in Juan Ysmael and Co., vs. Gabino
Baretto and Co., (51 Phil., 90; see numerous authorities there cited).
Defendant also cites and relies on the case of Government of the Philippine Among such authorities in the case of The Kengsington decided by the Supreme
Islands vs. Ynchausti & Company (40 Phil., 219), but it appears from a reading of Court of the U.S. January 6, 1902 (46 Law. Ed., 190), in which the opinion was
that case that the facts are very different and, hence, it is not in point. In the instant written by the late Chief Justice White, the syllabus of which is as follows:
case, there is no claim or pretense that the two cases were not in good order when
received on board the ship, and it is admitted that they were in bad order on their 1. Restrictions of the liability of a steamship company for its own negligence or
arrival at Manila. Hence, they must have been damaged in transit. In the very nature failure of duty toward the passenger, being against the public policy enforced by the
of things, if they were damaged by reason of a tempest, rocks, icebergs, foundering, courts of the United States, will not to be upheld, though the ticket was issued and
accepted in a foreign country and contained a condition making it subject to the law petitioner, Coastwise Lighterage. Coastwise Lighterage denied the claim and it was
thereof, which sustained such stipulation. PhilGen which paid the consignee, Pag-asa Sales, Inc., the amount of P700,000.00,
representing the value of the damaged cargo of molasses.
2. The stipulation in a steamship passenger's ticket, which compels him to value his
baggage, at a certain sum, far less than it is worth, or, in order to have a higher value In turn, PhilGen then filed an action against Coastwise Lighterage before the
put upon it, to subject it to the provisions of the Harter Act, by which the carrier Regional Trial Court of Manila, seeking to recover the amount of P700,000.00 which
would be exempted from all the liability therefore from errors in navigation or it paid to Pag-asa Sales, Inc. for the latter's lost cargo. PhilGen now claims to be
management of the vessel of other negligence is unreasonable and in conflict with subrogated to all the contractual rights and claims which the consignee may have
public policy. against the carrier, which is presumed to have violated the contract of carriage.
The RTC awarded the amount prayed for by PhilGen. On Coastwise Lighterage's
3. An arbitrary limitation of 250 francs for the baggage of any steamship passenger
appeal to the Court of Appeals, the award was affirmed.
unaccompanied by any right to increase the amount of adequate and reasonable
proportional payment, is void as against public policy.
PETITIONER’S CONTENTION:

2. Coastwise Lighterage Corp. v. CA, Petitioner contends that the RTC and the Court of Appeals erred in finding that it was
a common carrier. It stresses the fact that it contracted with Pag-asa Sales, Inc. to
G.R. No. 114167 transport the shipment of molasses from Negros Oriental to Manila and refers to this
July 12, 1995 contract as a "charter agreement". It then proceeds to cite the case of Home Insurance
Company vs. American Steamship Agencies, Inc. wherein this Court held: ". . . a
TOPIC: Rationale for the presumption common carrier undertaking to carry a special cargo or chartered to a special person
only becomes a private carrier."
FACTS:
Pag-asa Sales, Inc. entered into a contract to transport molasses from the province of
RESPONDENT’S CONTENTION:
Negros to Manila with Coastwise Lighterage Corporation, using the latter's dumb
barges. The barges were towed in tandem by the tugboat MT Marica, which is Petitioner's reliance on the aforementioned case is misplaced as the charter contract is
likewise owned by Coastwise. one that is of affreightment over the whole vessel, rather than a demise. As such, the
liability of the shipowner for acts or negligence of its captain and crew, would remain
Upon reaching Manila Bay, while approaching Pier 18, one of the barges, "Coastwise
in the absence of stipulation.
9", struck an unknown sunken object. The forward buoyancy compartment was
damaged, and water gushed in through a hole "two inches wide and twenty-two ISSUES:
inches long. As a consequence, the molasses at the cargo tanks were contaminated
and rendered unfit for the use it was intended. This prompted the consignee, Pag-asa 1. WON Coastwise Lighterage was transformed into a private carrier, by virtue of the
Sales, Inc. to reject the shipment of molasses as a total loss. Thereafter, Pag-asa contract of affreightment which it entered into with the consignee, Pag-asa Sales, Inc.
Sales, Inc. filed a formal claim with the insurer of its lost cargo, herein private What is the extent of its liability over the lost, damaged and deteriorated cargo?
respondent, Philippine General Insurance Company and against the carrier, herein
2. Whether or not the insurer was subrogated into the rights of the consignee against capacity to contract in accordance with this code, and prove the skill capacity and
the carrier,upon payment by the insurer of the value of the consignee's goods lost qualifications necessary to command and direct the vessel, as established by marine
while on board one of the carrier's vessels. and navigation laws, ordinances or regulations, and must not be disqualified
according to the same for the discharge of the duties of the position.
RULING:
2. On the issue of subrogation, which petitioner contends as inapplicable in this case,
1. No. The contract of affreightment entered into between the consignee and the we once more rule against the petitioner. We have already found the petitioner liable
carrier did not convert the latter into a private carrier, but remained a common carrier for breach of the contract of carriage it entered into with Pag-asa Sales, Inc.
and was still liable as such. Although a charter party may transform a common carrier However, for the damage sustained by the loss of the cargo which petitioner-carrier
into a private one, the same however is not true in a contract of affreightment on was transporting, it was not the carrier which paid the value thereof to Pag-asa Sales,
account of the distinction of the 2 kinds of charter parties e.g. Bareboat or demise and Inc. but the latter's insurer, herein private respondent PhilGen.
charter for affreightment.
Under the demise or bareboat charter of the vessel, the charterer will generally be
regarded as the owner for the voyage or service stipulated. The charterer mans the Article 2207 of the Civil Code is explicit on this point:
vessel with his own people and becomes the owner pro hac vice, subject to liability to
others for damages caused by negligence. Art. 2207. If the plaintiffs property has been insured, and he has received indemnity
from the insurance company for the injury or loss arising out of the wrong or breach
On the other hand a contract of affreightment is one in which the owner of the vessel of contract complained of, the insurance company shall be subrogated to the rights
leases part or all of its space to haul goods for others. It is a contract for special of the insured against the wrongdoer or the person who violated the contract. . . .
service to be rendered by the owner of the vessel and under such contract the general
owner retains the possession, command and navigation of the ship, the charterer or Undoubtedly, upon payment by respondent insurer PhilGen of the amount of
freighter merely having use of the space in the vessel in return for his payment of the P700,000.00 to Pag-asa Sales, Inc., the consignee of the cargo of molasses totally
charter hire (Puromines, Inc., v. CA) damaged while being transported by petitioner Coastwise Lighterage, the former was
subrogated into all the rights which Pag-asa Sales, Inc. may have had against the
As a common carrier, the presumption of negligence attaches to it when the goods it carrier, herein petitioner Coastwise Lighterage.
transports are lost, destroyed or deteriorated. This presumption may be overcome
only by proof of the exercise of extraordinary diligence such as placing a person with
navigational skills.  DISPOSITION:
Evidence on record shows that far from having rendered service with the greatest  
skill  and  utmost  foresight, and being free   from fault, the  carrier  was culpably WHEREFORE, premises considered, this petition is DENIED and the appealed
remiss in the observance of its duties. Jesus R. Constantino, the patron of the vessel decision affirming the order of Branch 35 of the Regional Trial Court of Manila for
"Coastwise 9" admitted that he was not licensed. The carrier failed to overcome this petitioner Coastwise Lighterage to pay respondent Philippine General Insurance
presumption of negligence as the patron did not possess the necessary license to Company the "principal amount of P700,000.00 plus interest thereon at the legal rate
navigate which is violatiev of the provisions in the Civil Code, to wit: computed from March 29, 1989, the date the complaint was filed until fully paid and
Art. 609. — Captains, masters, or patrons of vessels must be Filipinos, have legal
another sum of P100,000.00 as attorney's fees and costs  is likewise hereby the result that his feet slipped from under him and he fell violently on the
AFFIRMED platform. His body at once rolled from the platform and was drawn under the
moving car, where his right arm was badly crushed and lacerated. It appears
that after the plaintiff alighted from the train the car moved forward possibly
six meters before it came to a full stop. The accident occurred between 7 and
8 on a dark night. The station was dimly lit at the time, so the objects on the
platform were difficult to discern, especially to a person emerging from a
lighted car.
 
3. Plaintiff filed a suit before the CFI of the City of Manila for recovery of
damages. The CFI denied petitioner’s claim on account that petitioner
himself failed to use due caution in alighting from the coach.

PLAINTIFF’S CONTENTION
 
Manila Railrolad is liable upon the negligence of the servants and employees of the
3. JOSE CANGCO VS. MANILA RAILROAD CO.
defendant in placing the sacks of melons upon the platform and leaving them so
GR. NO. L-12191
placed as to be a menace to the security of passenger alighting from the company's
OCTOBER 14, 1918
trains.
NAPOLES
 
TOPIC: NEGLIGENCE BASED ON QUASI-DELICT
DEFENDANT’S CONTENTION
 
The railroad company's defense involves the assumption that even granting that the
FACTS:
negligent conduct of its servants in placing an obstruction upon the platform was a
breach of its contractual obligation to maintain safe means of approaching and
1. Plaintiff, Jose Cangco, a copy clerk of Manila Railroad, used a pass supplied
leaving its trains, the direct and proximate cause of the injury suffered by plaintiff
by his employer entitling him to ride the company’s train for free. Upon the
was his own contributory negligence in failing to wait until the train had come to a
occasion in question, the plaintiff arose from his seat in the second class-car
complete stop before alighting.
where he was riding and, making, his exit through the door, took his position
upon the steps of the coach, seizing the upright guardrail with his right hand
ISSUE:
for support.
 
 
WON MANILA RAILROAD SHOULD BE HELD LIABLE FOR CANGCO’S
2. As the train slowed down another passenger, named Emilio Zuñiga, also an
INJURIES (YES)
employee of the railroad company, got off the same car, alighting safely at
 
the point where the platform begins to rise from the level of the ground.
RULING:
When the train had proceeded a little farther the plaintiff stepped off also,
 
but one or both of his feet came in contact with a sack of watermelons with
It is important to note that the foundation of the legal liability of the defendant is the May 13, 1948
contract of carriage, and that the obligation to respond for the damage which Topic: Concurring Causes of Action
plaintiff has suffered arises, if at all, from the breach of that contract by reason of  
the failure of defendant to exercise due care in its performance. That is to say, its FACTS:
liability is direct and immediate, differing essentially, in legal viewpoint from that
presumptive responsibility for the negligence of its servants, imposed by article 1903  A taxicab owned by Fausto Barredo and driven by Rosendo Digman,
of the Civil Code, which can be rebutted by proof of the exercise of due care in their collided in Manila thoroughfare with a Chevrolet car driven by Maria Luisa
selection and supervision. Article 1903 of the Civil Code is not applicable to Martinez.
obligations arising ex contractu, but only to extra-contractual obligations — or to use
the technical form of expression, that article relates only to culpa aquiliana and not to  Mutual charges of damage to property through reckless imprudence was filed
culpa contractual. by Martinez against Digman and another by Barredo against Martinez.
 
It is not accurate to say that proof of diligence and care in the selection and control of  After investigation, the fiscal filed an information against Digman and
the servant relieves the master from liability for the latter's acts — on the contrary, quashed Barredo's complaint
that proof shows that the responsibility has never existed. As Manresa says the
liability arising from extra-contractual culpa is always based upon a voluntary act  Digman entered a plea of guilty of criminal case and was therefore sentenced
or omission which, without willful intent, but by mere negligence or inattention, has to pay a fine of P605.97 and to indemnify Maria Luisa Martinez in the same
caused damage to another. A master who exercises all possible care in the selection amount, with subsidiary imprisonment in case of insolvency, and the costs.
of his servant, taking into consideration the qualifications they should possess for the
discharge of the duties which it is his purpose to confide to them, and directs them  Digman failed to pay any of these amounts and had to undergo
with equal diligence, thereby performs his duty to third persons to whom he is bound corresponding subsidiary imprisonment. Because of this, Martinez filed an
by no contractual ties, and he incurs no liability whatever if, by reason of the action in the CFI of Manila against Barredo, as Digman’s employer, for the
negligence of his servants, even within the scope of their employment, such third purpose of holding him subsidiarily liable for said indemnity under Articles
person suffer damage. True it is that under article 1903 of the Civil Code the law 102 and 103 of RPC.
creates a presumption that he has been negligent in the selection or direction of his
servant, but the presumption is rebuttable and yield to proof of due care and diligence  At the trial Maria Luisa Martinez relied solely of the judgment of conviction
in this respect. against Rosendo Digman, the writ of execution issued against him, a
  certificate of the Director of Prisons regarding Digman's service of subsidiary
The decision of lower court is reversed, and judgment is hereby rendered plaintiff for imprisonment, and the information filed against Digman.
the sum of P3,290.25, and for the costs of both instances. So ordered.
 Maria Luisa Martinez obtained a favorable judgment from which Barredo
 
appealed to the Court of Appeals.

4 MARIA LUISA MARTINEZ vs. MANUEL H. BARREDO, ET AL.  The CA reversed the decision of the CFI and held that the judgment of
conviction was not conclusive against Barredo and its weight as prima facie
GR No. : L-49308 evidence was overcome by the evidence presented by Barredo. This decision
 made reference to cases decided by SC holding that such judgment of proof beyond reasonable doubt is necessary, should be nullified in a subsequent civil
conviction is not admissible and to the prevailing view in the United States to action requiring only preponderance of evidence to support a judgment, unless those
the effect that the person subsidiary liable is bound by the judgment if the who support the contrary rule should also hold that an absolution in a civil case will
former had the notice of the criminal case and could have defended it had he operate to automatically set aside the verdict against the defendant in a criminal case.
seen fit to do so, and that otherwise such judgment is only prima facie  
evidence. It is anomalous, to say the least, to suppose that the driver, excelling that "Dr. Jekyll
and Mr. Hyde", could be guilty of reckless negligence in so far as his obligation to
 Hence the present appeal of Maria Luisa Martinez by way of certiorari. pay indemnity is concerned, and at the same time could be free from any blame when
  said indemnity is sought to be collected in his employer, although the right to
indemnity arose from and was based on one and the same act of the driver.
PETITIONER’S ARGUMENT/S:  
The employer cannot be said to have been deprived of his day in court, because the
Barredo, as employer of Digaman, shall be subsidiarily liable for indemnity of situation before us is not one wherein the employer is sued for a primary liability
damages under Articles 102 and 103 if the RPC. under article 1903 of the Civil Code, but one in which enforcement is sought of a
  subsidiary civil liability incident to and defendant upon his driver's criminal
negligence which is a proper issue to be tried and decided only in criminal action. In
RESPONDENT’S ARGUMENT/S: other words, the employer becomes ipso facto subsidiary liable upon his driver's
conviction and upon proof of the latter's insolvency, in the same way that acquittal
Judgment was not conclusive against him and its weight as prima facie evidence was wipes out not only the employee's primary civil liability but also his employer's
overcome by the evidence he presented. subsidiary liability for such criminal negligence.
   
It is high time that the employer exercise the greatest care in selecting his employees,
taking real and deep interest in their welfare; intervening in any criminal action
ISSUE: brought against them by reason of or as a result of the performance of their duties if
only in the way of giving them the benefit of counsel; and consequently doing away
WON a judgment of conviction sentencing Digman to pay an indemnity is conclusive with practice of leaving them to their fates. If this be done, the American rule
in an action against his employer for enforcement of the latter's subsidiary liability. requiring notice on the part of the employer shall have been satisfied.
(YES)  
It becomes unnecessary to rely on the circumstance that the filing of mutual charges
RULING: by Fausto Barredo and Maria Luisa Martinez, with the result, as abovestated, that
while the fiscal proceeded in filing the information against Digman, he quashed the
The judgment of conviction, in the absence of any collusion between the defendant charges of Fausto Barredo, may easily lead to the presumption that the latter should
and the offended party, should bind the person subsidiary liable. have had knowledge of the criminal case against his driver. We need not also make
  any pronouncement to the effect that the prevailing American view is based upon
The stigma of a criminal conviction surpasses in effect and implications mere civil substantive and procedural laws not similar to those obtaining to his jurisdiction.
liability. Common sense dictates that a finding of guilt in a criminal case in which  
 Among those who perished were Timoteo Mapanao, Francisca Lacsamana, Narcisa
DISPOSITION: Mendoza and Gregorio Sibayan, whose heirs sued petitioner and the latter's driver,
Hermenegildo Aquino, for damages for breach of contract of carriage.
Wherefore, the decision of the Court of Appeals is reversed, and Fausto Barredo, Carolina Sabado, one of those injured, also sued petitioner and the driver for
now substituted by his heirs and legal representatives, are hereby sentenced to pay, damages. The complaints were filed in the Court of First Instance of La Union.
subject to Executive Order No. 32 on Moratorium, to the petitioner, Maria Luisa
Martinez, the sum of P605.97, with legal interest from the date of the filing of
complaint. So ordered with costs against the respondents. Petitioner’s Contention:

In their answer, petitioner and her driver blamed respondent Gregorio Hufana for the
accident. With leave of court, they filed third party complaints against Hufana and
5. VILUAN vs. CA the latter's employer, Patricio Hufana.

G.R. Nos. L-21477-81

TOPIC: CONCURRING CAUSES OF ACTION After trial, the court found that the accident was due to the concurrent negligence of
the drivers of the two buses and held both, together with their respective employers,
jointly and severally liable for damages.
FACTS: CA Decision:
Seven persons were killed and thirteen others were injured in Bangar, La Union, on Both petitioner and her driver and the respondents herein appealed to the Court of
February 16, 1958, when a passenger bus on which they were riding caught fire after Appeals.
hitting a post and crashing against a tree. The bus, owned by petitioner and driven by While affirming the finding that the accident was due to the concurrent negligence of
Hermenegildo Aquino, came from San Fernando, La Union and was on its way to the drivers of both the Viluan and the Hufana buses, the Court of Appeals differed
Candon, Ilocos Sur. with the trial court in the assessment of liabilities of the parties.
It appears that, as the bus neared the gate of the Gabaldon school building in the
municipality of Bangar, another passenger bus owned by Patricio Hufana and driven In its view only petitioner Francisca Viluan, as operator of the bus, is liable for
by Gregorio Hufana tried to overtake it but that instead of giving way, Aquino breach of contract of carriage.
increased the speed of his bus and raced with the overtaking bus. Aquino lost control
of his bus as a result of which it hit a post, crashed against a tree and then burst into
flames. The driver, Hermenegildo Aquino, cannot be made jointly and severally liable with
petitioner because he is merely the latter's employee and is in no way a party to the
contract of carriage. The court added, however —
Filing of Claim:
 Hermenegildo Aquino is not entirely free from liability. He may be held In this case the third-party complaints filed by petitioner and her driver charged
liable, criminally and civilly, under the Revised Penal Code (Articles 100 and respondents with direct liability to the plaintiffs. It was contended that the accident
103), but not in a civil suit for damages predicated upon a breach of contract, was due "to the fault, negligence, carelessness and imprudence of the third party
such as this one (Aguas, et al. vs. Vargas, et al., CA-G.R. No. 27161-R, Jan. defendant Gregorio Hufana" and, in petitioner's motion for leave to file a third party
22, 1963). Furthermore, the common carrier, Francisca Viluan could recover complaint, it was stated that "Patricio Hufana and Gregorio Hufana were not made
from Aquino any damages that she might have suffered by reason of the parties to this action, although the defendants are entitled to indemnity and/or
latter's negligence. subrogation against them in respect of plaintiff's claim."

From this judgment petitioner brought this appeal. In brief, her position is that since It should make no difference therefore whether the respondents were brought in as
the proximate cause of the accident was found to be the concurrent negligence of the principal defendants or as third-party defendants. As Chief Justice Moran points out,
drivers of the two buses, then she and respondent Patricio and Gregorio Hufana since the liability of the third-party defendant is already asserted in the third-party
should have been held equally liable to the plaintiffs in the damage suits. The fact complaint, the amendment of the complaint to assert such liability is merely a matter
that the respondents were not sued as principal defendants but were brought into the of form, to insist on which would not be in keeping with the liberal spirit of the Rules
cases as third party defendants should not preclude a finding of their liability. of Court.
Nor should it make any difference that the liability of petitioner springs from contract
The appellate court likewise disallowed the award of moral damages for P1,000.00 to while that of respondents arises from quasi-delict. As early as 1913, we already ruled
Carolina Sabado, there being no showing that the common carrier was guilty of fraud in Gutierrez vs. Gutierrez, 56 Phil. 177, that in case of injury to a passenger due to
or bad faith in the performance of her obligation. the negligence of the driver of the bus on which he was riding and of the driver of
another vehicle, the drivers as well as the owners of the two vehicles are jointly and
severally liable for damages. Some members of the Court, though, are of the view
ISSUE: that under the circumstances they are liable on quasi-delict.

Whether or not Patricio and Gregorio Hufana should have been held equally liable to Wherefore, the decision appealed from is hereby modified in the sense that petitioner
the plaintiffs in the damage suits. (YES) as well as respondents Patricio Hufana and Gregorio Hufana are jointly and severally
liable for the damages awarded by the trial court. The disallowance of moral damages
in the amount of P1,000.00 is correct and should be affirmed. No costs.
RULING: NOTES:

To begin with, the Court of Appeals' ruling is based on section 5 of Rule 12 of the The third party complaint:
former Rules of Court, which was adopted from Rule 14-a of the Federal Rules of As explained in the Atlantic Coast Line R. Co. vs. U. S. Fidelity & Guaranty Co., 52
Civil Procedure. F. Supp. 177 (1943):

The rule does not apply where a third-party defendant is impleaded on the ground of From the sources of Rule 14 and the decisions herein cited, it is clear that this
direct liability to the plaintiffs, in which case no amendment of the plaintiffs rule, like the admiralty rule, "covers two distinct subjects, the addition of
complaint is necessary. parties defendant to the main cause of action, and the bringing in of a third
party for a defendant's remedy over." x x x
 If the third party complaint alleges facts showing a third party's direct  
liability to plaintiff on the claim set out in plaintiff's petition, then third party Topic: Concurring cause of Action
"shall" make his defenses as provided in Rule 12 and his counterclaims  
against plaintiff as provided in Rule 13. In the case of alleged direct liability,  
no amendment is necessary or required. The subject-matter of the claim is Overview:
contained in plaintiff's complaint, the ground of third party's liability on that  
claim is alleged in third party complaint, and third party's defense to set up in This appeal was raised by counsel for the commercial firm of Gutierrez Hermanos
his an to plaintiff's complaint. At that point and without amendment, the counsel for the judgment rendered by the Honorable A. S. Crossfield, judge, in favor
plaintiff and third party are at issue as to their rights respecting the claim. of the plaintiff and against the defendant firm of Gutierrez Hermanos. Judgement was
for the sum of P1,600, together with interest at 6 per cent per annum from the first
The provision in the rule that, "The third-party defendant may assert any day of March 1912, and for the costs of the action. 
defenses which the third-party plaintiff may assert to the plaintiff's claim,"  
applies to the other subject, namely, the alleged liability of third party
defendant. The next sentence in the rule, "The third-party defendant is bound Facts:
by the adjudication of the third party plaintiff's liability to the plaintiff, as  
well as of his own to the plaintiff or to the third-party plaintiff," applies to 1. Attorney Eduardo Gutierrez Repide filed suit in the Court of First Instance
both subjects. If third party is brought in as liable only to defendant and of this city against the commercial firm of Gutierrez Hermanos, alleging that
judgment is rendered adjudicating plaintiff's right to recover against he had at its request rendered it services as attorney.
defendant and defendant's rights to recover against third party, he is bound
by both adjudications. That part of the sentence refers to the second subject. 2. After the litigation was decided, the plaintiff was to collect from Gutierrez
If third party is brought in as liable to plaintiff, then third party is bound by Hermanos P12,218.51 and interest thereon as fees for all the professional
the adjudication as between him and plaintiff. That refers to the first subject. services he had rendered in that suit. However, this sum had not been paid
If third party is brought in as liable to plaintiff and also over to defendant, by him either wholly or partly. He therefore asked that Gutierrez Hermanos
then third party is bound by both adjudications. The next sentence in the rule, be sentenced to pay the said sum, with legal interest thereon from the date of
the filing of the complaint, and the costs. 
"The plaintiff may amend his pleadings to assert against the third-party
defendant any claim which the plaintiff might have asserted against the third- 3. The defense of defendant was that the plaintiff agreed that the fee which the
party defendant had he been joined originally as a defendant," refers to the latter was to collect for all his professional services and for all the suits
second subject, that is, to bringing in third party as liable to defendant only, which the might have to bring against Oria Hermanos, including all
and does not apply to the alleged liability of third party directly to plaintiff." procedure had therein until their termination, should not exceed P10,000. As
  he claims that the said sum should be reduced by such amount for it to be
just and reasonable.

6. EDUARDO GUTIERREZ REPIDE, Plaintiff-Appellee, v. GUTIERREZ 4.    The defendant also claims that that the plaintiff, failing to comply with his
HERMANOS, Defendant-Appellant.  engagements, ceased to defend the defendant and withdrew as its attorney
[G.R. No. 8896. December 29, 1913. ] just prior to the date set for the hearing, without giving the defendant time to
 turn over its defense to another attorney, and, ignoring his contract,  The said steamship arrived in the port of Manila on or about the 10th day of
commenced to sue the defendant. Defendant prays for dismissal of the September, 1919, consigned to the defendant herein as agent and
plaintiff’s complaint. representative of said vessel in said port. Neither the master of said vessel
nor the defendant herein, as its agent, delivered to the plaintiff the aforesaid
Issue: twelve 8-day Edmond clocks, although demand was made upon them for
Whether the contentions of the defendant is valid? No (Amu la talaga ini waray their delivery.
anything transpo related ha case)
Ruling:  The invoice value of the said twelve 8-day Edmond clocks in the city of New
  York was P22 and the market value of the same in the City of Manila at the
The court ruled that the contentions of defendant was not valid and that the time when they should have been delivered to the plaintiff was P420.
conclusions and the legal grounds of the judgment appealed from are in accordance
with the law and the merits of the case. (Amu la talaga ini waray na further  The bill of lading contained, among others, the following clauses:
discussion ha case)
  1. It is mutually agreed that the value of the goods receipted for
  above does not exceed $500 per freight ton, or, in proportion for
Dispositive: any part of a ton, unless the value be expressly stated herein and
  ad valorem freight paid thereon.
We accept the statement of facts, the conclusions and the legal grounds of the 2. Also, that in the event of claims for short delivery of, or damage
judgment appealed from, since they are in accordance with the law and the merits of to, cargo being made, the carrier shall not be liable for more than
the case, and affirm the said judgment, with the costs against the Appellant.  the net invoice price plus freight and insurance less all charges
  saved, and any loss or damage for which the carrier may be
liable shall be adjusted pro rata on the said basis.

7. H. E. HEACOCK COMPANY, plaintiff-appellant, vs. MACONDRAY &  The case containing the aforesaid twelve 8-day Edmond clocks measured 3
COMPANY, INC., defendant-appellant. cubic feet, and the freight ton value thereof was $1,480, U. S. currency. No
G.R. No. L-16598   greater value than $500, U. S. currency, per freight ton was declared by the
October 3, 1921 plaintiff on the aforesaid clocks, and no ad valorem freight was paid thereon.
Topic: Stipulations limiting the liability of the carrier in a bill of lading  
H. E. HEACOCK COMPANY’s contention:
Facts:
 On or about the 5th day of June, 1919, the plaintiff caused to be delivered on Plaintiff-appellant insists that it is entitled to recover from the Macondray &
board of steamship Bolton Castle, then in the harbor of New York, four cases Company, Inc. the market value of the clocks in question, to wit: the sum of
of merchandise one of which contained twelve (12) 8-day Edmond clocks P420. The claim is based upon the argument that the two clauses in the bill of
properly boxed and marked for transportation to Manila, and paid freight on lading, limiting the liability of the carrier, are contrary to public order and,
said clocks from New York to Manila in advance. therefore, null and void.
Macondray & Company, Inc.: the extent of the agreed valuation, even in case of loss or damage by the
negligence of the carrier, the contract will be upheld as proper and lawful
The defendant-appellant, on the other hand, contends that, in accordance with mode of securing a due proportion between the amount for which the carrier
clause 1 of the bill of lading, the plaintiff is entitled to recover only the sum may be responsible and the freight he receives, and protecting himself
of P76.36, the proportionate freight ton value of the said clocks. The against extravagant and fanciful valuations."
defendant contends that both of said clauses are valid, and that clause 1
should have been applied by the lower court instead of clause 9. In the case of Union Pacific Railway Co. vs. Burke, supra, the court
said: that if a common carrier gives to a shipper the choice of two rates, the
Issue:  lower of the conditioned upon his agreeing to a stipulated valuation of his
property in case of loss, even by the carrier's negligence, if the shipper makes
WHETHER OR NOT A COMMON CARRIER, BY STIPULATIONS such a choice, understandingly and freely, and names his valuation, he
INSERTED IN THE BILL OF LADING, MAY LIMIT ITS LIABILITY cannot thereafter recover more than the value which he thus places upon his
FOR THE LOSS OF OR DAMAGE TO THE CARGO TO AN AGREED property. As a matter of legal distinction, estoppel is made the basis of this
VALUATION OF THE LATTER? (YES) ruling, — that, having accepted the benefit of the lower rate, in common
honesty the shipper may not repudiate the conditions on which it was
Ruling: obtained, — but the rule and the effect of it are clearly established."

Three kinds of stipulations have often been made in a bill of lading. It seems clear from the foregoing authorities that the clauses (1 and
The first is one exempting the carrier from any and all liability for loss or 9) of the bill of lading here in question are not contrary to public order.
damage occasioned by its own negligence. The second is one providing for Article 1255 of the Civil Code provides that "the contracting parties may
an unqualified limitation of such liability to an agreed valuation. And the establish any agreements, terms and conditions they may deem advisable,
third is one limiting the liability of the carrier to an agreed valuation unless provided they are not contrary to law, morals or public order." Said clauses
the shipper declares a higher value and pays a higher rate of freight. of the bill of lading are, therefore, valid and binding upon the parties thereto.
According to an almost uniform weight of authority, the first and second
kinds of stipulations are invalid as being contrary to public policy, but the Additional Issue: Whether clause 1 or clause 9 of the bill of lading here
third is valid and enforceable. in question is to be adopted as the measure of defendant's liability.

A reading of clauses 1 and 9 of the bill of lading here in question, Macondray & Company, Inc. contends that these two clauses, if
however, clearly shows that the present case falls within the third stipulation, construed together, mean that the shipper and the carrier stipulate and agree
to wit: That a clause in a bill of lading limiting the liability of the carrier to a that the value of the goods receipted for does not exceed $500 per freight ton,
certain amount unless the shipper declares a higher value and pays a higher but should the invoice value of the goods be less than $500 per freight ton,
rate of freight, is valid and enforceable. then the invoice value governs; that since in this case the invoice value is
more than $500 per freight ton, the latter valuation should be adopted and
In the case of Hart vs. Pennsylvania R. R. Co., supra, it was held that that according to that valuation, the proportionate value of the clocks in
"where a contract of carriage, signed by the shipper, is fairly made with a question is only P76.36 which the defendant is ready and willing to pay to
railroad company, agreeing on a valuation of the property carried, with the the plaintiff.
rate of freight based on the condition that the carrier assumes liability only to
 It is difficult to reconcile them without doing violence to the
language used and reading exceptions and conditions into the undertaking
contained in clause 9 that are not there. This being the case, the bill of lading
in question should be interpreted against the defendant carrier, which drew
said contract. "A written contract should, in case of doubt, be interpreted
against the party who has drawn the contract."

It is a well-known principle of construction that ambiguity or