Rule of Law

By:  Atty. Gregorio B. Austral, CPA

Obligation and Liability of Common Carriers

The obligation of the common carrier is to take the cargo to the point of destination safely, and if the cargo is damaged or lost before delivery, there is breach of contract. Under Article 1752 of the Civil Code, if the cargo is lost or damaged, immediately a presumption arises:  that the damage or loss of the cargo was due to the negligence of the common carrier.  All that the shipper proves is that the goods arrived in a damaged condition or that they did not arrive at all.

Article 1735 of the Civil Code provides that in case of lost or damaged goods, common carriers are presumed to have been at fault or to have acted negligently, unless they prove that they observed extraordinary diligence as required by Article 1733. (Villanueva citing Air France v. Gillego, 638 SCRA 472 (2011)).

In Central Shipping Co. vs. Insurance Company of North America, 438 SCRA 511 (2004), the rules for the liability of a common carrier for lost or damaged cargo are as follows:

1. From the nature of their business and for reasons of public policy, common carriers are bound to observe extraordinary diligence over the goods they transport, according to all the circumstances of each case;
2. In the event of loss, destruction, or deterioration of the insured goods, common carriers are responsible unless they can prove that such loss, destruction or deterioration was brought about by the cases specified in Article 1734 of the Civil Code, among others, “flood, storm, earthquake, lightning, or other natural disasters”; and
3. In all other cases not specified under Article 1734, they are presumed to have been at fault or to have acted negligently, unless they observed extraordinary diligence.

The extraordinary responsibility of the common carriers lasts from the time the goods are unconditionally placed in the possession of and received by the carrier for transportation until the same are delivered, actually or constructively, by the carrier to the consignee or to the person who has the right to receive them.  (Philippines First Insurance Co. v. Wallem Phils. Shipping, 582 SCRA 457 (2009))