Mercantile Law Q&As (2007-2013)

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train

and

JayArhSals

that

it

was

XYZs acquisition of shares of Acme, Inc.

negligence. Decide. (5%)

and Golden Boy, Inc., taken separately,

SUGGESTED ANSWER:

does not reach 35% threshold. If taken

collectively, the two acquisitions total
only

50%.

However,

when

the

acquisitions are added to XYZs existing

shares in Union Mines, they meet the
more-

than

-51%

thresholds

for

mandatory tender offer.

not

guilty

of

CRI is liable for death of Ricardo Santos

because

it

failed

to

exercise

extraordinary diligence (LRTA v. Navidad

G.R. No. 145804, 06 February 2003). The
contract of carriage began when the
passenger

purchased

proceeded

to

the

his

ticket

designated

and

loading

facilities to board the train (Dangwa

Transp. Co., Inc. v. Court of Appeals,
G.R. No. 95582, 07 October 1991), CRI is
also liable for all persons in its employ

Transportation Law

(Caltex
Lines,

Carriage; Breach of Contract

Philippines,
Inc.,

G.R.

Inc.
No.

v.

Sulpicio

131166,

30

September 1999).
No.VIII. City Railways, Inc. (CRI) provides
train service, for a fee, to commuters from
Manila to Calamba, Laguna. Commuter are
required to purchase tickets and then
proceed

to

designated

loading

and

unloading facilities to board the train.

Ricardo Santos purchased a ticket for
Calamba and entered the station. While
waiting, he had an altercation with the
security guard of CRI leading to a fistfight.
Ricardo Santos fell on the railway just as a
train was entering the station. Ricardo
Santos was run over by the train. He died.
In the action for damages filed by the heirs
of Ricardo Santos, CRI interposed lack of
cause of action, contending that the mishap

Carriage; Breach of Contract; Cause of

Action; Defenses (2009)
No.XIX. One of the passenger buses owned
by Continental Transit Corporation (CTC),
plying its usual route figured in a collision
with another

bus owned by Universal

Transport, Inc. (UTI). Among those injured

inside the CTC bus were: Romeo, a stow
away: Samuel, a pickpocket then in the act
of robbing his seatmate when the collision
occurred; Teresita, the bus drivers mistress
who usually accompanied the driver on his

occurred before Ricardo Santos boarded the

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trips for free; and Uriel, holder of a free

(B) Do Romeo, Samuel, Teresita, and Uriel

riding pass he won in a raffle held by CTC.

have a cause of action for damages against

(A) Will a suit for breach of contract of

UTI? Explain. (3%)

carriage filed by Romeo, Samuel, Teresita,

SUGGESTED ANSWER:

and Uriel against CTC prosper? Explain.

Romeo, Samuel, Teresita and Uriel may

(3%)

sue UtI on the basis of quasi-delict since

they have no pre-existing contractual

SUGGESTED ANSWER:

relationship with UTI. They may allege

Romeo cannot sue for breach of contract

that

of carriage. A stowaway like Romeo, Who

negligence of driver of UTI and UTI was

secures

negligent

passage

passenger

(Vda.

by

fraud,

is

De

nueca v.

not

Manial

the

collision
in

was

the

due

to

selection

the
and

supervision of its driver (Articles 2176

Railroad Company, 13 C.A. R. 49(1968)).

and 2180, New Civil Code).

Samuel and Teresita cannot sue for

(C) What, if any, are the valid defenses that

breach

CTC and UTI can raise in the respective

of

contract

of

carriage.

The

Elements in the definition of a passenger

actions against them? Explain. (3%)

are: an undertaking of a person to travel

SUGGESTED ANSWER:

in

the

With respect to Romeo, Samuel and

carrier and an acceptance by the carrier

Teresita, since there was no pre-existing

of the person as a passenger. (14 Am Jur

contractual relationship between them

2d, Carriers, So. 714,p. 164). Samuel did

and CTC, CTC can raise the defense that

not board the bus to be transported but

it exercised the due diligence of a good

to commit robbery. Teresita did not

father of a family in the selection and

board the bus to be transported but to

supervision of its driver (Article 2180,

accompany the

New Civil Code).

the

conveyance

provided

driver while

by

he

was

performing his work.

Uriel can sue for breach of contract. He

It can raise the same defense against

was a passenger although he was being

Uriel

transported gratuitously, because he won

exempts

a free riding pass in a raffle held by CTC

negligence, but not for willful acts or

(Article 1753, New Civil Code).

gross negligence (Article 1758, New Civil

if

there
it

is

from

stipulation

liability

for

that

simple

Code).

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Mercantile Law Q&As (2007-2013)

CTC

can

also

raise

hectorchristopher@yahoo.com

against

all

the

JayArhSals

de Oro airport; the pilot miscalculated the

plaintiffs the defense that the collision

planes

approach

and

undershot

the

was due exclusively to the negligence of

runway. Of the 150 people on board, ten

the driver of UTI, and this constitutes a

(10) passengers died at the crash scene.

fortuitous event, because there was no

concurrent negligence on the part of its

Of the ten who died, one was a passenger

own

v.Guinoo

who managed to leave the plane but was

Transportation Company, G.R. No. L-

run over by an ambulance coming to the

5044, April 30, 1953).

rescue. Another was an airline employee

driver

(Ampang

who hitched a free ride to Cagayan de Oro

CTC can also raise against Samuel the
defense

that

he

was

engaged

in

and who was not in the passenger manifest.

seriously illegal act at the time of the

It

appears

from

the

Civil

Aeronautics

collision, which can render him liable for

Authority investigation that the co-pilot

damages on the basis of quasi-delict

who had control of the planes landing had

(Dobbs, the Law of Torts, pp.524-525).

less than the required flying and landing

time experience, and should not have been

Since

UTI

had

no

pre-existing

in control of the plane at the time. He was

contractual relationship with any of the

allowed to fly as a co-pilot because of the

plaintiffs, it can raise the defense that it

scarcity of pilots Philippine pilots have

exercised due diligence in the selection

been recruited by foreign airlines under

and supervision of its driver that the

vastly improved flying terms and wages so

collision was due exclusively to the

that newer and less trained pilots are being

negligence of the driver of CTC, and that

locally deployed. The main pilot, on the

Samuel was committing a serious illegal

other hand, had a very high level of blood

act at the time of the collision.

alcohol at the time of the crash.

You are part of the team that the victims
hired to handle the case for them as a
group.

Carriage;

Breach

of

Contract;

In

your

case

conference,

the

following questions came up:

Presumption of Negligence (2013)

a

(A) Explain the causes of action legally

scheduled passenger flight from Manila

possible under the given facts against the

when it crashed as it landed at the Cagayan

airline and the Pilots; whom will you

No.IX.

Fil-Asia

Flight

916

was

on

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specifically implead in these causes of

over. This is in accordance with Articles

action? (5%)

2176 and 2180 of the Civil Code. There

could also be a criminal prosecution for

SUGGESTED ANSWER:

reckless

A complaint for breach of contract of

homicide against the ambulance driver

carriage can be filed against Fil-Asia for

and the consequent civil liability.

failure

to

exercise

imprudence

resulting

in

extraordinary

diligence in transporting the passengers

Since the airline employee was being

safety from their point of embarkation

transported gratuitously, Fil-Asia Air was

to their destination (Article 1755, Civil

not required to exercise extraordinary

Code).

diligence for his safety and only ordinary

care. (Lara v. Valencia, 104 Phil. 65,

A complaint based on a quasi-delict can

1958).

be filed against the pilots because of

their fault and negligence (Article 2176,
Civil Code). Fil-Asia Air can be included
for

negligence

in

the

selection

and

supervision of the pilots (Article 2180,

Civil Code).

Maritime Protest (2007)

No.XI. Two vessels figured in a collision
along the Straits of Guimaras resulting in

A third cause of action may be a criminal

considerable loss of cargo. The damaged

prosecution

imprudence

vessels were safely conducted to the Port of

resulting in homicide against two pilots.

Iloilo Passenger A failed to file a maritime

The airline will be subsidiarily liable for

protest. B, a non-passenger but a shipper

the civil liability only after the pilots are

who suffered damage to his cargo, likewise

convicted and found to be insolvent.

did not file a maritime protest at all. (10%)

(B) How will you handle the cases of the

(A) What is a maritime protest?

for

reckless

passenger run over the ambulance and the

airline employee allowed to hitch a free ride

SUGGESTED ANSWER:

to Cagayan de Oro? (3%)

A maritime protest is a sworn statement

SUGGESTED ANSWER:

made with 24 hours after a collision in

It is the driver of the ambulance and his

which the circumstances thereof are

employer who should be held liable for

declared

damages, because a passenger was run

competent authority at the point of

or

made

known

before

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