Ma. Victoria M.

Sarmiento
January 2017

Syllabus/Outline for
Transportation Law

Course Description: A study of the general principles and basic regulations governing
carriers (land, air and sea) of persons and goods. The course includes the study of the
rights and obligations of the parties as well as a study of the regulatory framework that
governs the transportation business and other public utilities. The course will end with
discussion of the basic rules regarding the agencies that regulate public utilities

Recommended Text: Essentials of Transportation and Public Utilities Law by

Timoteo Aquino and Ramon Paul Hernando (2015)

I. GENERAL CONSIDERATIONS/DEFINITIONS FOR TRANSPORTATION

LAW

A. Overview of Transportation Law (NCC Article 1766)

1. New Civil Code

2. Code of Commerce
3. Special Laws:
a. Carriage of Goods by Sea Act (Public Act 521)
b. Salvage Law (Act 2616)
c. Public Service Act (Common Wealth Act 146)
d. Land Transportation and Traffic Code (R. A. 4136)
e. Civil Aeronautics Act R.A. 776, Civil Aviation Authority Act R.A. 9497
f. E.O. 125 and 125-A, R.A. 7471 Philippine Overseas Shipping Act, P.D.
474 Maritime Industry Decree of 1974, R.A. 9295 Domestic Shipping
Development Act of 2004
g. Tariff and Customs Code
h. Warsaw Convention

B. Definition of Contract of Transportation

1. Parties

Shipper/Carrier/Consignee (NCC Article 1735)

Passenger/Carrier (NCC Article 1755)

2. Perfection

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 Light Rail Transit Authority vs. Marjorie Natividad G.R. 145804, February
6, 2003

C. Common carriers

1. Definition New Civil Code. Article 1732

2. Test to determine

3. Characteristics
a. Public Service/public utilities NCC Article 1733, Article XII, 1987
Constitution, Section 13 Public Service Act
b. Clientele
c. Means of Transportation NCC Article 1732, First Philippine Industrial
Corporation vs. CA (G.R. 125948, December 29 1998)
d. Extraordinary diligence Article 1733 NCC
4. Effect of charter party - Planters Products Inc. vs. Court of Appeals , 226 SCRA
476
5. Common carrier distinguished from private carrier - F. G. U. Insurance vs. G. P.
Sarmiento Trucking Corporation, 386 SCRA 312, August 6, 2002
Home Insurance Co. vs. American Steamship Agencies Inc. 23 SCRA 24
6. Common carrier distinguished from other contracts
a. Distinguished from towage
b. Distinguished from arrastre
Insurance Co. of North America vs. Phil Ports Terminal 97 Phil 288
c. Distinguished from stevedoring - Mindanao Terminal and
Brokerage Service Inc. vs. Phoeniz Assurance Co. of New York. G. R. 162467 , May
8, 2009 d. Distinguished from travel agency -

7. Governing laws (NCC, Article 1766 relate to Article 1753)

8. Nature of business Fisher v. Yangco Steamship Company (1914) 31 Phil 1

9. .Registered owner rule & kabit system
a. Registration laws
b. Registered owner rule - Erezo vs. Jepte G.R. L 9605, September 30, 1957

c. Kabit system - Lita Enterprises Inc. vs IAC 129 SCRA 79

d. Pari delicto rule

e. Aircrafts & vessel

10. Boundary system Hernandez v. Dolor, G.R. No. 160286, July 30, 2004

II. OBLIGATIONS OF THE PARTIES

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A. Obligation of the carrier

1. Duty to accept (see Fisher vs. Yangco supra)

2. Valid grounds for non-acceptance (Code of Commerce Article 356, 357)

3. Duty to deliver the goods Saludo Jr. vs. CA G.R. 95536 March 23, 1992

4. Consequences of delay (NCC Article 1740, 1747; Article 370 -374 Code of
Commerce)
5. Rights of passengers in case of delay
6. Place of delivery (Article 360, Code of Commerce)

7. To whom delivered (Article 368 and 369, Code of Commerce)

8. Delay to transport passenger

B. Duty to exercise extraordinary diligence Article 1733 (NCC)

1. Code of commerce (Article 363-365)

2. Presumption of negligence (Article 1735, NCC)
3. Duration of duty in carriage of goods (Article 1736 to 1738, NCC)
4. Commencement of duty in carriage of passenger Light Rail Transit Authority vs.
Marjorie Natividad G.R. 145804, February 6, 2003, La Mallorca vs. Court of Appeals
17 SCRA 739

C. Defenses of common carrier (NCC Article 1734, 1739, 1740, 1742, 1743)

1. Proximate causation Philippine American General Insurance Co. vs. PKS

Shipping Company G.R. No. 149038, April 9, 2003

2. New civil code provision (Article 1734, 1739 NCC)

3. Defense in carriage of goods Calvo vs. UCPB General Insurance Co, Inc. 379
SCRA 510
4. Fortuitous event (Article 1739 NCC)

5. Public enemy (Article 1742 NCC)

6. Improper packing (Article 1742 NCC)

7. Order of public authority (Article 1743, NCC)

8. Defenses of carriage of passenger Lasam vs. Smith G.R. No. 19495 Feb 2, 1924

9. acts of employees (Article 1759 NCC) Marana vs. Perez G.R. 22272, June 26,
1967

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 10. acts of other passengers & third person (Article 1763, NCC) Bachelor Express
Inc. vs. CA G.R. 85691, July 31, 1990

D. Passengers baggages (Art 1754, 1998, 2000 to 2003, NCC)

1. baggage defined
2. Check in baggage Sarkies Tours Philippines vs. CA, 280 SCRA 58

3. Hand carried luggage

E. Obligation of shipper, consignee and passenger Japan Airlines vs. CA 294

SCRA 19, Philippine National Railways vs. CA G.R. No. L055347, October 4,
1985

1. negligence shipper or passenger (Article 1741, 1761, 1762, NCC)

2. Payment of freight (Article 374 -375, Code of Commerce)

3. Payment of demurrage Compania Maritama vs. CA G.R. No. L 31379, August

29, 1988

III. EXTRAORDINARY DILIGENCE REQUIRED OF COMMON CARRIERS

A. Rationale
B. Duty of Carrier and Duty to third persons
C. Effect of stipulation on extraordinary diligence (NCC, Article 1744, 1757-
1758,1760) 1. Goods

2. Passenger
D. Extraordinary diligence in carriage by sea (COGSA)

1. Seaworthiness
2. Cargo worthiness
3. Proper manning
4.Adequate equipment
5. Overloading
6. Proper storage
7. Negligence of captain & crew
8. Rules on passenger safety
9. Deviation (Code of Commerce Article 359)
10. Transshipment

E. Extraordinary diligence in carriage by land

5.01. Condition of vehicle
5.02. Traffic rules
5.03. Duty to inspect

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 F. Duty to inspect in carriage by sea

IV. BILL OF LADING & OTHER FORMALITIES

A. Definition
B. Kinds of bill of lading
C. Nature of bill of lading
1. Bill of lading as contract
2.Parties
3. Contract of adhesion
4. Parol evidence rule
5. Bill of lading as evidence
6 Bill of lading as actionable document
7. Shipment terms
D. Basic stipulations
1. Overland transportation
2. Maritime commerce
3. Electronic documents
E. Prohibited & limiting stipulations
1. Purpose of limiting stipulations
2. Stipulation limiting diligence
3. Stipulation fixing the limit of recovery
F. Bill of lading as receipt
G. Bill of lading as document of title

V. ACTIONS & DAMAGES IN CASE OF BREACH

A. Causes of Action
1. Distinctions between culpa contractual & culpa aquiliana
2. Concurrent causes of action
3. Concurrence with third person
4. Solidary liability
5. Alternative compensation scheme
B. Notice of claim & prescriptive period

1. Claim in overland transportation & coastwise shipping

2. Prescription in overland transportation & coastwise shipping
3. Claim in international carriage of goods by sea
4. Prescription in international carriage of goods

C. Recoverable damages
1. Actual or compensatory damages
2. Attorneys fees
3. Interests
4. Moral damage

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 5. Nominal damage
6. Temperate or moderate damage
7. Liquidated damage
8. Exemplary or corrective damages

VI. MARITIME LAW

A. Maritime law definition

B. Real & hypothecary nature
1. Statutory provisions
2. Coverage of limited liability
3. Exceptions to limited liability
4. Negligence of shipowner & agent
5. Not applicable to insurance claim
6. Workmens compensation
7. Abandonment
8. Procedure for enforcement
C. Protest
D. Admiralty jurisdiction
E. Forfeiture due to smuggling
F. Maritime pollution
1. Prohibited act
2. Definition
G. Marine Insurance

VII. VESSELS

A. Definition
B. Constructive, equipment & manning
C. Vessel as personal property
D. Acquisition
E. Nationality of vessels
1. Rights under the tariff & customs code
2. Flags of convenience
F. Registration of vessels
G.Ships manifest
H. Logbook
I. Safety regulation

VIII. SHIP MORTGAGE & MARITIME LIENS

A. Applicable laws & rules

1.The ship mortgage decree of 1978
2. Code of commerce provisions
3. History of ship mortgage decree

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B. Maritme Lien
1. Preferred claim
2. Executory contracts doctrines
3. Waiver of lien
4. Prescription & laches
5. Maritime liens for necessaries
6. Maritime tort
7. Salvage lien
8. Subrogation
9. When proceeds not sufficient
10. Tests to determine the presence of lien
C. Preferred ship mortgage
1. Purpose
2. Formal requirements
3. Marina rules
D. Mortgage of vessel with other properties
1. Mortgage with non-maritime property
2.. Fleet mortgage
E. Arrest & foreclosure

IX. PERSONS WHO TAKE PART IN MARITIME COMMERCE

A. Shipowner
B. Ship agent
C. Captain and Masters of Vessel
D. Part-owners
E. Pilotage
F. Officers & crew of vessel
G. Sailing mate
H. Second mate & marine engineer
I. Crew
J. Supercargoes

X. CHARTER PARTIES

A. Definition 412
B. Different kinds of charter parties 413
1. Bareboat charter 413
2. Contract of affreightment 414
C. Effect of charter on charter on char. of carrier 415
D. Persons who may make charter 416
1. Charter 417
2. Part owners 417
3. Ship agent
4.Captain or master
E. Requisites of a valid charter party

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F. Freight
G. Port of unloading
H. Demurrage
1. Computation of lay days
2. Deadfreight
I. Rights & obligation of the charter parties
J. .Effect of bill of lading
K. Code of commerce provision

XI LOANS ON BOTTOMRY & RESPONDENTIA

A. Definitions & concept

B. Distinguished from simple loan
C. Authority to constitute loan on bottomry
D. Authority to constitute loan on respondentia
E. Form of the loan
F. Consequences of loss of effects of the loan
G. Code of commerce provisions

XII AVERAGES

A. Averages in general
B. Simple average
C. Gen. Average
1. Requisites of gen. average
a. Common danger
b. Deliberate sacrifice
c. Successful sacrifice
d, Compliance with legal steps
2. Who bears gen. average
a. Insurers
b. Lenders on bottomry & respondents
3. Who is entitled to indemnity
D. Effect of negligence
E. Apportionment
F Proof & liquidation of ave. code of commerce
G. York-antwerp rules

XIII. COLLISIONS

A. Definition
B. Zones in collision
1. Error extremis
C. Application law
D. Rules on liability
1. One vessel at fault

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 2. Both vessel at fault
3. Party at fault cannot be determined
4. Cause is fortuitous event
5. 3rd perso at fault
E. Sinking on the way to port
F. Presence of pilots
G. Extent of liability
H. Collision in foreign waters
I. Protest
J. Limited liability rule

XIV. ARRIVAL UNDER STRESS AND SHIPWRECKS

A. Arrival under stress

1. Determination of property
2. When arrival under stress is improper
3. Expenses
4. Unloading of cargoes to market repairs
5. Custody of cargo
6.Liability of captain
B. Shipwrecks

XV. SALVAGE

A. Governing law
B. Definition
C. Rationale
D. Kinds of salvage services
E. Claim for valid salvage
1. Persons not entitled to salvage compensation
2. Requisites of compensation
3. Derelict required
4. Jetsam & flotsam
F. Basis of entitlement to salvage reward
1. Quantum meruit not applicable
2. Circumstances to consider
G. Rights & obligations of salvor and owner
1. Maritime lien

XVI. CARRIAGE OF GOODS BY SEA

A. History
B. Parties
C. Duties of carrier
D. Document of title required
E. Notice of claim & prescriptive period

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F. Defenses & immunities
G. Waiver
H. Limiting provision
I. Right to discharge dangerous cargo

XVII CIVIL AVIATION

A. Applicable laws
B. Civil aviation
C. Registration of aircraft
D. Recording of conveyances
E. Marine insurance
F. Air transportation in gen.
G. Persons involved in marine transportation
H. Charter of aircraft
I. Sovereignty & freedom
1. Freedoms of the air
2. Cancellation of commercial agreement

XVIII. OBLIGATIONS OF CARRIER IN AIR TRANSPORTATION

A. Extraordinary diligence in air transportation

1 Airworthiness
B. Care of baggage
C. Duty of passenger
1. Denied boarding passenger
2. Travel document
D. Inspection of aircraft and cargo
E. Warsaw convention
1. Meaning of international transportation
2. Period covered by international transportation
3. When an international carrier is liable
4. Limit of liability
5. Tort liability
6. Venue of action
7. Successive carrier
8. Formalities

XIX SERVICE REGULATION

A. Concept
B. Constitutional provisions
C. Regulatory agencies
D. Bases of reg. of public utilities
E. Ownership of public utilities
1. Ownership of facilities

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F. Regulation of rates
1. Non delegation
2. Deregulation of domestic shipping
3. Prohibition against discrimination
4. Standard in fixing rates
5. Fixing rates for elec. companies
6. LTFRB
7. Provisional Increase
8. Provisional rate increase under EPIRA
G. Authority to operate as public Utility
1. Franchise & cert. of public
2. When leg. Franchise is necessary
3. Issuance of certificate of public convenience
4. Basic requisites
5. Pub. interest is overriding principle
6. Other rules & policies
7. Free Competition
8. Nature of certificate of public convenience
9. Instances when CPC is not required
H. Transfer of CPC
I. Revocation of CPC
1. When NTC has no power to cancel
J. Due process
1. When no hearing is required

XX. POWERS OF ADMINISTRATIVE AGENCIES

A. Department of Transportation and Communication

B. LTFRB
C. LTO
D. Civil aeronautics board `
1. Policies
2. Powers & duties of Cab
3 Summ. of CAB powers
E. Civil aviation authority of the phils
1. Declared policy
2. Powers of the CAAP Board
F. Maritime industry authority
G. Philippine coast guard
1. Power
2. Delineation of function
H. Philippine port authority
1. Powers of PPA
I. NTC
1. Powers of NTC
2. Telecom policies

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 3. Broadcast industry
II. .ERC
1. Franchise
2 Power generator
III. Local utilities admin
1. MWSS

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