Transportation Laws - Definition

FIRST DIVISION

[G.R. No. 138334. August 25, 2003]

ESTELA L. CRISOSTOMO, petitioner, vs. THE COURT OF

APPEALS and CARAVAN TRAVEL & TOURS
INTERNATIONAL, INC., respondents.
DECISION
YNARES-SANTIAGO, J.:
In May 1991, petitioner Estela L. Crisostomo contracted
the services of respondent Caravan Travel and Tours
International, Inc. to arrange and facilitate her booking,
ticketing and accommodation in a tour dubbed Jewels of
Europe. The package tour included the countries of England,
Holland, Germany, Austria, Liechstenstein, Switzerland and
France at a total cost of P74,322.70. Petitioner was given a
5% discount on the amount, which included airfare, and the
booking fee was also waived because petitioners niece,
Meriam Menor, was respondent companys ticketing manager.
Pursuant to said contract, Menor went to her aunts
residence on June 12, 1991 a Wednesday to deliver
petitioners travel documents and plane tickets. Petitioner, in
turn, gave Menor the full payment for the package tour. Menor
then told her to be at the Ninoy Aquino International Airport
(NAIA) on Saturday, two hours before her flight on board
British Airways.
Without checking her travel documents, petitioner went to
NAIA on Saturday, June 15, 1991, to take the flight for the first
leg of her journey from Manila to Hongkong. To petitioners
dismay, she discovered that the flight she was supposed to
take had already departed the previous day. She learned that
her plane ticket was for the flight scheduled on June 14, 1991.
She thus called up Menor to complain.
Subsequently, Menor prevailed upon petitioner to take
another tour the British Pageant which included England,
Scotland and Wales in its itinerary. For this tour package,
petitioner was asked anew to pay US$785.00 or P20,881.00
(at the then prevailing exchange rate of P26.60). She gave
respondent US$300 or P7,980.00 as partial payment and
commenced the trip in July 1991.
Upon petitioners return from Europe, she demanded
from respondent the reimbursement of P61,421.70,
representing the difference between the sum she paid for
Jewels of Europe and the amount she owed respondent for
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the British Pageant tour. Despite several demands,

respondent company refused to reimburse the amount,
contending that the same was non-refundable.1[1] Petitioner
was thus constrained to file a complaint against respondent for
breach of contract of carriage and damages, which was
docketed as Civil Case No. 92-133 and raffled to Branch 59 of
the Regional Trial Court of Makati City.
In her complaint,2[2] petitioner alleged that her failure to
join Jewels of Europe was due to respondents fault since it
did not clearly indicate the departure date on the plane ticket.
Respondent was also negligent in informing her of the wrong
flight schedule through its employee Menor. She insisted that
the British Pageant was merely a substitute for the Jewels of
Europe tour, such that the cost of the former should be
properly set-off against the sum paid for the latter.
For its part, respondent company, through its Operations
Manager, Concepcion Chipeco, denied responsibility for
petitioners failure to join the first tour. Chipeco insisted that
petitioner was informed of the correct departure date, which
was clearly and legibly printed on the plane ticket. The travel
documents were given to petitioner two days ahead of the
scheduled trip. Petitioner had only herself to blame for
missing the flight, as she did not bother to read or confirm her
flight schedule as printed on the ticket.
Respondent explained that it can no longer reimburse the
amount paid for Jewels of Europe, considering that the same
had already been remitted to its principal in Singapore, Lotus
Travel Ltd., which had already billed the same even if
petitioner did not join the tour. Lotus European tour organizer,
Insight International Tours Ltd., determines the cost of a
package tour based on a minimum number of projected
participants. For this reason, it is accepted industry practice to
disallow refund for individuals who failed to take a booked
tour.3[3]
Lastly, respondent maintained that the British Pageant
was not a substitute for the package tour that petitioner
missed. This tour was independently procured by petitioner
after realizing that she made a mistake in missing her flight for
Jewels of Europe. Petitioner was allowed to make a partial
payment of only US$300.00 for the second tour because her
niece was then an employee of the travel agency.
Consequently, respondent prayed that petitioner be ordered to
pay the balance of P12,901.00 for the British Pageant
package tour.
After due proceedings, the trial court rendered a
1[1] TSN, March 4, 1993, pp. 4-6.
2[2] RTC Records, p. 1.
3[3] TSN, August 30, 1994, pp. 6-9.

Transportation Laws - Definition

decision,4[4] the dispositive part of which reads:
WHEREFORE,
premises
considered,
judgment is hereby rendered as follows:
1.Ordering the defendant to return and/or
refund to the plaintiff the amount of
Fifty Three Thousand Nine Hundred
Eighty Nine Pesos and Forty Three
Centavos (P53,989.43) with legal
interest thereon at the rate of twelve
percent (12%) per annum starting
January 16, 1992, the date when the
complaint was filed;
2.

Ordering the defendant to pay the

plaintiff the amount of Five Thousand
(P5,000.00) Pesos as and for
reasonable attorneys fees;

3.

Dismissing
the
defendants
counterclaim, for lack of merit; and

4.

With costs against the defendant.

SO ORDERED.5[5]
The trial court held that respondent was negligent in
erroneously advising petitioner of her departure date through
its employee, Menor, who was not presented as witness to
rebut petitioners testimony. However, petitioner should have
verified the exact date and time of departure by looking at her
ticket and should have simply not relied on Menors verbal
representation. The trial court thus declared that petitioner was
guilty of contributory negligence and accordingly, deducted
10% from the amount being claimed as refund.
Respondent appealed to the Court of Appeals, which
likewise found both parties to be at fault. However, the
appellate court held that petitioner is more negligent than
respondent because as a lawyer and well-traveled person, she
should have known better than to simply rely on what was told
to her. This being so, she is not entitled to any form of
damages. Petitioner also forfeited her right to the Jewels of
Europe tour and must therefore pay respondent the balance
of the price for the British Pageant tour. The dispositive
portion of the judgment appealed from reads as follows:
WHEREFORE, premises considered, the
decision of the Regional Trial Court dated October
26, 1995 is hereby REVERSED and SET ASIDE. A
new judgment is hereby ENTERED requiring the
plaintiff-appellee to pay to the defendant-appellant
the amount of P12,901.00, representing the
[4]

4 Rollo, pp. 38-43.

5[5] Id. at 43; penned by Judge Lucia Violago Isnani.
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balance of the price of the British Pageant Package

Tour, the same to earn legal interest at the rate of
SIX PERCENT (6%) per annum, to be computed
from the time the counterclaim was filed until the
finality of this decision. After this decision becomes
final and executory, the rate of TWELVE PERCENT
(12%) interest per annum shall be additionally
imposed on the total obligation until payment
thereof is satisfied. The award of attorneys fees is
DELETED. Costs against the plaintiff-appellee.
SO ORDERED.6[6]
Upon denial of her motion for reconsideration,7[7]
petitioner filed the instant petition under Rule 45 on the
following grounds:
I
It is respectfully submitted that the Honorable Court
of Appeals committed a reversible error in reversing
and setting aside the decision of the trial court by
ruling that the petitioner is not entitled to a refund of
the cost of unavailed Jewels of Europe tour she
being equally, if not more, negligent than the private
respondent, for in the contract of carriage the
common carrier is obliged to observe utmost care
and extra-ordinary diligence which is higher in
degree than the ordinary diligence required of the
passenger. Thus, even if the petitioner and private
respondent were both negligent, the petitioner
cannot be considered to be equally, or worse, more
guilty than the private respondent. At best,
petitioners negligence is only contributory while the
private respondent [is guilty] of gross negligence
making the principle of pari delicto inapplicable in
the case;
II
The Honorable Court of Appeals also erred in not
ruling that the Jewels of Europe tour was not
indivisible and the amount paid therefor refundable;
III
The Honorable Court erred in not granting to the
petitioner the consequential damages due her as a
result of breach of contract of carriage.8[8]
Petitioner contends that respondent did not observe the
standard of care required of a common carrier when it
informed her wrongly of the flight schedule. She could not be
6[6] Id. at 36.
7[7] Id. at 37.
8[8] Id. at 15.

Transportation Laws - Definition

deemed more negligent than respondent since the latter is
required by law to exercise extraordinary diligence in the
fulfillment of its obligation. If she were negligent at all, the
same is merely contributory and not the proximate cause of
the damage she suffered. Her loss could only be attributed to
respondent as it was the direct consequence of its employees
gross negligence.
Petitioners contention has no merit.
By definition, a contract of carriage or transportation is
one whereby a certain person or association of persons
obligate themselves to transport persons, things, or news from
one place to another for a fixed price. 9[9] Such person or
association of persons are regarded as carriers and are
classified as private or special carriers and common or public
carriers.10[10] A common carrier is defined under Article 1732 of
the Civil Code as 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.
It is obvious from the above definition that respondent is
not an entity engaged in the business of transporting either
passengers or goods and is therefore, neither a private nor a
common carrier. Respondent did not undertake to transport
petitioner from one place to another since its covenant with its
customers is simply to make travel arrangements in their
behalf. Respondents services as a travel agency include
procuring tickets and facilitating travel permits or visas as well
as booking customers for tours.
While petitioner concededly bought her plane ticket
through the efforts of respondent company, this does not mean
that the latter ipso facto is a common carrier. At most,
respondent acted merely as an agent of the airline, with whom
petitioner ultimately contracted for her carriage to Europe.
Respondents obligation to petitioner in this regard was simply
to see to it that petitioner was properly booked with the airline
for the appointed date and time. Her transport to the place of
destination, meanwhile, pertained directly to the airline.
The object of petitioners contractual relation with
respondent is the latters service of arranging and facilitating
petitioners booking, ticketing and accommodation in the
package tour. In contrast, the object of a contract of carriage is
the transportation of passengers or goods. It is in this sense
that the contract between the parties in this case was an
ordinary one for services and not one of carriage. Petitioners
submission is premised on a wrong assumption.
9[9] Commentaries and Jurisprudence on the Commercial Laws

of the Philippines, Vol. 4 (1993 Edition), Aguedo F. Agbayani,

p. 1, citing 1 Blanco 640.
10[10] Id. at 4.
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The nature of the contractual relation between petitioner

and respondent is determinative of the degree of care required
in the performance of the latters obligation under the contract.
For reasons of public policy, a common carrier in a contract of
carriage is bound by law to carry passengers as far as human
care and foresight can provide using the utmost diligence of
very cautious persons and with due regard for all the
circumstances.11[11] As earlier stated, however, respondent is
not a common carrier but a travel agency. It is thus not bound
under the law to observe extraordinary diligence in the
performance of its obligation, as petitioner claims.
Since the contract between the parties is an ordinary one
for services, the standard of care required of respondent is
that of a good father of a family under Article 1173 of the Civil
Code.12[12] This connotes reasonable care consistent with that
which an ordinarily prudent person would have observed when
confronted with a similar situation. The test to determine
whether negligence attended the performance of an obligation
is: did the defendant in doing the alleged negligent act use that
reasonable care and caution which an ordinarily prudent
person would have used in the same situation? If not, then he
is guilty of negligence.13[13]
In the case at bar, the lower court found Menor negligent
when she allegedly informed petitioner of the wrong day of
departure. Petitioners testimony was accepted as indubitable
evidence of Menors alleged negligent act since respondent
did not call Menor to the witness stand to refute the allegation.
The lower court applied the presumption under Rule 131,
Section 3 (e)14[14] of the Rules of Court that evidence willfully
11[11] Civil Code of the Philippines, Article 1755.

12

[12]

Article 1173. The fault or negligence of the obligor

consists in the omission of that diligence which is
required by the nature of the obligation and
corresponds with the circumstances of the persons,
of the time and of the place. When negligence shows
bad faith, the provisions of Articles 1171 and 2201,
paragraph 2, shall apply.If the law or contract does
not state the diligence which is to be observed in the
performance, that which is expected of a good father
of a family shall be required.

13[13] Jarco Marketing Corporation v. Court of Appeals, 378

Phil. 991, 1003 (1999), citing Picart v. Smith, 37 Phil. 809

(1918).
[14]
14
This rule states:SEC. 3. Disputable presumptions.
The following presumptions are satisfactory if
uncontradicted, but may be contradicted and
overcome by other evidence:
x x xx x x
xxx
(e)
That evidence willfully suppressed would be adverse
if produced;
xxx
xxx
xxx

Transportation Laws - Definition

suppressed would be adverse if produced and thus considered
petitioners uncontradicted testimony to be sufficient proof of
her claim.
On the other hand, respondent has consistently denied
that Menor was negligent and maintains that petitioners
assertion is belied by the evidence on record. The date and
time of departure was legibly written on the plane ticket and
the travel papers were delivered two days in advance precisely
so that petitioner could prepare for the trip. It performed all its
obligations to enable petitioner to join the tour and exercised
due diligence in its dealings with the latter.
We agree with respondent.
Respondents failure to present Menor as witness to
rebut petitioners testimony could not give rise to an inference
unfavorable to the former. Menor was already working in
France at the time of the filing of the complaint,15[15] thereby
making it physically impossible for respondent to present her
as a witness. Then too, even if it were possible for respondent
to secure Menors testimony, the presumption under Rule 131,
Section 3(e) would still not apply. The opportunity and
possibility for obtaining Menors testimony belonged to both
parties, considering that Menor was not just respondents
employee, but also petitioners niece. It was thus error for the
lower court to invoke the presumption that respondent willfully
suppressed evidence under Rule 131, Section 3(e). Said
presumption would logically be inoperative if the evidence is
not intentionally omitted but is simply unavailable, or when the
same could have been obtained by both parties.16[16]
In sum, we do not agree with the finding of the lower
court that Menors negligence concurred with the negligence of
petitioner and resultantly caused damage to the latter.
Menors negligence was not sufficiently proved, considering
that the only evidence presented on this score was petitioners
uncorroborated narration of the events. It is well-settled that
the party alleging a fact has the burden of proving it and a
mere allegation cannot take the place of evidence. 17[17] If the
plaintiff, upon whom rests the burden of proving his cause of
action, fails to show in a satisfactory manner facts upon which
he bases his claim, the defendant is under no obligation to
prove his exception or defense.18[18]
Contrary to petitioners claim, the evidence on record

shows that respondent exercised due diligence in performing

its obligations under the contract and followed standard
procedure in rendering its services to petitioner. As correctly
observed by the lower court, the plane ticket19[19] issued to
petitioner clearly reflected the departure date and time,
contrary to petitioners contention. The travel documents,
consisting of the tour itinerary, vouchers and instructions, were
likewise delivered to petitioner two days prior to the trip.
Respondent also properly booked petitioner for the tour,
prepared the necessary documents and procured the plane
tickets. It arranged petitioners hotel accommodation as well as
food, land transfers and sightseeing excursions, in accordance
with its avowed undertaking.
Therefore, it is clear that respondent performed its
prestation under the contract as well as everything else that
was essential to book petitioner for the tour. Had petitioner
exercised due diligence in the conduct of her affairs, there
would have been no reason for her to miss the flight. Needless
to say, after the travel papers were delivered to petitioner, it
became incumbent upon her to take ordinary care of her
concerns. This undoubtedly would require that she at least
read the documents in order to assure herself of the important
details regarding the trip.
The negligence of the obligor in the performance of the
obligation renders him liable for damages for the resulting loss
suffered by the obligee. Fault or negligence of the obligor
consists in his failure to exercise due care and prudence in the
performance of the obligation as the nature of the obligation so
demands.20[20] There is no fixed standard of diligence
applicable to each and every contractual obligation and each
case must be determined upon its particular facts. The degree
of diligence required depends on the circumstances of the
specific obligation and whether one has been negligent is a
question of fact that is to be determined after taking into
account the particulars of each case.21[21]
The lower court declared that respondents employee
was negligent. This factual finding, however, is not supported
by the evidence on record. While factual findings below are
generally conclusive upon this court, the rule is subject to
certain exceptions, as when the trial court overlooked,
misunderstood, or misapplied some facts or circumstances of
weight and substance which will affect the result of the case. 22
[22]

15[15] Supra, note 3 at 10.

16[16] The Revised Rules of Court in the Philippines, Vol. VII,

19[19] Supra, note 2 at 60 & 94.

20[20] Bayne Adjusters and Surveyors, Inc. v. Court of Appeals,

Part II (1999 Edition) V. Francisco, p. 92.

17[17] Pimentel v. Court of Appeals, 307 SCRA 38.
18[18] Castilex Industrial Corporation v. Vasquez, Jr., 378 Phil.
1009, 1018 (1999), citing Belen v. Belen, 13 Phil. 202, 206
(1909), cited in Martin v. Court of Appeals, G.R. No. 82248,
205 SCRA 591 (1992).

G.R. No. 116332, 323 SCRA 231 (2000), citing Articles 1170,
1172-73, Civil Code; Southeastern College, Inc. v. Court of
Appeals, 354 Phil 434 (1998).
21[21] Commentaries and Jurisprudence on the Civil Code of
the Philippines, Vol. IV (1999 Edition), Arturo M. Tolentino, p.
124.

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Transportation Laws - Definition

In the case at bar, the evidence on record shows that
respondent company performed its duty diligently and did not
commit any contractual breach. Hence, petitioner cannot
recover and must bear her own damage.
WHEREFORE, the instant petition is DENIED for lack of
merit. The decision of the Court of Appeals in CA-G.R. CV No.
51932 is AFFIRMED. Accordingly, petitioner is ordered to pay
respondent the amount of P12,901.00 representing the
balance of the price of the British Pageant Package Tour, with
legal interest thereon at the rate of 6% per annum, to be
computed from the time the counterclaim was filed until the
finality of this Decision. After this Decision becomes final and
executory, the rate of 12% per annum shall be imposed until
the obligation is fully settled, this interim period being deemed
to be by then an equivalent to a forbearance of credit.23[23]
SO ORDERED.
Davide, Jr., C.J., (Chairman), Vitug, Carpio, and Azcuna,
JJ., concur.

22[22] Supra, note 13, citing Borillo v. CA, G.R. No. 55691, 209

SCRA 130 (1992); Mckee v. Intermediate Appellate Court,

G.R. No. 68102, 211 SCRA 517 (1992); and Salvador v. Court
of Appeals, 313 Phil. 36 (1995).
23[23] Eastern Shipping Lines, Inc. v. Court of Appeals, G.R.
No. 97412, 12 July 1994, 234 SCRA 78, 97.
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