Adolfo Santos v.

Abraham Sibug and CA

G.R. No. L-26815 May 26, 1981
Melencio-Herrera, J.

FACTS:
Vicente Vidad duly authorized passenger jeepney operator
prior to the accident date, Santos was the owner of a passenger jeep, but he had
no certificate of public convenience for the operation of the vehicle as a public
passenger jeep; he then transferred his jeep to the name of Vidad so that it could be
operated under the latters certificate of public convenience; Santos, in effect,
became a kabit operator
on the accident date Sibug was bumped by a passenger jeepney operated by
Vidad and driven by Severe Gragas; as a result thereof, Sibug filed a complaint for
damages against Vidad and Gragas
the trial court sentenced Vidad and Gragas, jointly and severally, to pay Sibug for
the damages he suffered
Sheriff of Manila levied on a motor vehicle registered in the name of Vidad (but
owned by Santos)
Santos presented a third-party claim with the Sheriff alleging actual ownership of
the motor vehicle levied upon, and stating that registration thereof in the name of
Vidad was merely to enable Santos to make use of Vidads CPC

ISSUE: WON the subject motor vehicle owned by Santos should be attached to
satisfy the money judgment against Vidad who is the registered owner of the same

HELD: Yes.
Sec. 20 (g) of the Public Service Act: ... it shall be unlawful for any public service or
for the owner, lessee or operator thereof, without the approval and authorization of
the Commission previously had ... (g) to sell, alienate, mortgage, encumber or
lease its property, franchise, certificates, privileges, or rights, or any part thereof.
Although Santos, as the kabit was the true owner, Vidad, as the registered
owner/operator and grantee of the franchise, is directly and primarily responsible
and liable for the damages caused to Sibug, the injured party, as a consequence of
the negligent or careless operation of the vehicle. (Ratio: the operator of record is
considered the operator of the vehicle in contemplation of law as regards the public
and third persons even if the vehicle involved in the accident had been sold to
another where such sale had not been approved by the then Public Service
Commission)
Santos remedy, as the real owner of the vehicle, is to go against Vidad, the
actual operator who was responsible for the accident, for the recovery of whatever
damages Santos may suffer by reason of the execution

Lita Enterprises, Inc. v. Second Civil Cases Division, IAC, Nicasio Ocampo and
Francisca Garcia
G.R. No. L-64693 April 27, 1984
Escolin, J.

FACTS:
Ocampo and Garcia purchased in installment from the Delta Motor Sales
Corporation 5 Toyota Corona Standard cars to be used as taxicabs; they had no
franchise to operate taxicabs, so they contracted with Lita Enterprises for the use of
the latters certificate of public convenience in consideration of an initial payment of
1,000.00 and a monthly rental of 200.00 per taxicab unit; the aforesaid cars were
then registered in the name of Lita Enterprises
one of the taxicabs driven by Ocampo and Garcias employee, Emeterio
Martin, collided with a motorcycle whose driver, Florante Galvez, died from the head
injuries sustained therefrom
a criminal case was filed against the driver Martin, while a civil case for
damages was instituted by heir of the victim against Lita Enterprises

ISSUE: WON Lita Enterprises is liable to the heir of the victim who died as a result of
the gross negligence of Ocampo and Garcias driver while driving one private
respondents taxicabs

HELD: Yes.
kabit system system whereby a person who has been granted a certificate
of convenience allows another person who owns motors vehicles to operate under
such franchise for a fee; contrary to public policy and, therefore, void and inexistent
under Article 1409 of the Civil Code; as a result, the court will not aid either party to
enforce an illegal contract, but will leave them both where it finds them (pari delicto
rule)
Art. 1412: If the act in which the unlawful or forbidden cause consists does
not constitute a criminal offense, the following rules shall be observed; (1) when the
fault, is on the part of both contracting parties, neither may recover what he has
given by virtue of the contract, or demand the performance of the others
undertaking.
the defect of inexistence of a contract is permanent and incurable, and
cannot be cured by ratification or by prescription

Teja Marketing and/or Angel Jaucian v. IAC and Pedro Nale

G.R. No. L-65510 March 9, 1987
Paras, J.

FACTS:
Jaucian bought from the Nale a motorcycle with complete accessories and a
sidecar; out of the total purchase price the Jaucian gave a downpayment of
1,700.00 with a promise that he would pay Nale the balance within sixty days. The
Jaucian, however, failed to comply with his promise and so upon his own request,
the period of paying the balance was extended to one year in monthly installments
until January 1976 when he stopped paying anymore
a chattel mortgage was constituted as a security for the payment of the
balance of the purchase price
it has been the practice of financing firms that whenever there is a balance of
the purchase price the registration papers of the motor vehicle subject of the sale
are not given to the buyer
the motorcycle sold to the defendant was first mortgaged to the Teja
Marketing by Jaucian because the latter had no franchise of his own (CPC) so he
attached the unit to Nales MCH Line
the agreement of the parties was for Nale to undertake the yearly registration
of the motorcycle with the Land Transportation Commission; pursuant to this
agreement Jaucian gave Nale P90.00, the P8.00 would be for the mortgage fee and
the P82.00 for the registration fee of the motorcycle; Nale failed to register the
motorcycle on the ground that the Jaucian failed to comply with some requirements
such as the payment of the insurance premiums and the bringing of the motorcycle
to the LTC for stenciling, Nale saying that the defendant was hiding the motorcycle
from him; Nale explained that though the ownership of the motorcycle was already
transferred to Jaucian, the vehicle was still mortgaged with the consent of the
Jaucian to the Rural Bank of Camaligan for the reason that all motorcycle purchased
from Nale on credit was rediscounted with the bank
because of the failure of Nale to register the motorcycle Jaucian suffered
damages when he failed to claim any insurance indemnity for the more than two
times that the motorcycle figured in accidents
Nale filed an action for collection of sum of money with damages against Nale

ISSUE: WON not respondent court erred in applying the doctrine of pari delicto

HELD: No.
kabit system is contrary to public policy and, therefore, void and in existent
under Article 1409 of the Civil Code; the court will not aid either party to enforce an
illegal contract, but will leave both where it finds then
Art. 1412: If the act in which the unlawful or forbidden cause consists does
not constitute a criminal offense, the following rules shall be observed: 1. When the
fault is on the part of both contracting parties, neither may recover that he has
given by virtue of the contract, or demand, the performance of the others
undertaking.

URBANO MAGBOO and EMILIA MAGBOO vs. DELFIN BERNARDO

April 30, 1963

Facts:
1. Spouses Urbano Magboo and Emilia C. Magboo are the parents of Cesar
Magboo, a child of 8 years old, who was killed a motor vehicle accident. The vehicle
is a passenger jeepney owned by Delfin Bernardo, the defendant. At the time of the
accident, said jeepney was driven by Conrado Roque.

2. The contract of Roque and Bernardo is that of the boundary system where
they both agreed that Roque will pay the sum of P8.00 to defendant for letting him
drive the jeepney; and that whatever earnings Roque could make out of the use of
the jeepney would belong to Roque.

3. Conrado Roque was prosecuted for homicide thru reckless imprudence before
the CFI of Manila. Upon arraignment, he pleaded guilty and was sentenced arresto
mayor with indemnification with subsidiary imprisonment in case of insolvency.

4. Roque was insolvent so the trial court ordered the defendant to pay plaintiffs
P3,000. Bernardo assails decision and contends that there is no employer-employee
relationship under a boundary system.

Issue: Whether or not an employer-employee relationship exists between a jeepney-

owner and a driver under a "boundary system" arrangement?
Ruling: YES. There is an employer-employee relationship under a boundary system
arrangement.

a. The fact that the driver does not receive a fixed wage but gets only the
excess of the receipt of fares collected by him over the amount he pays to the jeep-
owner and that the gasoline consumed by the jeep is for the account of the driver
are not sufficient to withdraw the relationship between them from that of employer
and employee.

b. To exempt from liability the owner of a public vehicle who operates it under
the "boundary system" on the ground that he is a mere lessor would be not only to
abet flagrant violations of the Public Service law but also to place the riding public
at the mercy of reckless and irresponsible drivers

[G.R. No. 160286. July 30, 2004.]

SPOUSES FRANCISCO M. HERNANDEZ and ANICETA ABEL-HERNANDEZ and JUAN
GONZALES, petitioners, vs. SPOUSES LORENZO DOLOR and MARGARITA DOLOR,
FRED PANOPIO, JOSEPH SANDOVAL, RENE CASTILLO, SPOUSES FRANCISCO
VALMOCINA and VIRGINIA VALMOCINA, SPOUSES VICTOR PANOPIO and MARTINA
PANOPIO, and HON. COURT OF APPEALS, respondents.

PONENTE: YNARES-SANTIAGO, J

Facts: At about 3:00 p.m. of December 19, 1986, Lorenzo Menard "Boyet" Dolor, Jr.
was driving an owner-type jeepney with plate no. DEB 804 owned by her mother,
Margarita, towards Anilao, Batangas. As he was traversing the road at Barangay
Anilao East, Mabini, Batangas, his vehicle collided with a passenger jeepney bearing
plate no. DEG 648, driven by petitioner Juan Gonzales and owned by his co-
petitioner Francisco Hernandez, which was travelling towards Batangas City. Boyet
Dolor and his passenger, Oscar Valmocina, died as a result of the collision. Fred
Panopio, Rene Castillo and Joseph Sandoval, who were also on board the owner-type
jeep, which was totally wrecked, suffered physical injuries. The collision also
damaged the passenger jeepney of Francisco Hernandez and caused physical
injuries to its passengers.
Consequently, respondents commenced an action for damages against petitioners
before the Regional Trial Court of Batangas City, alleging that driver Juan Gonzales
was guilty of negligence and lack of care and that the Hernandez spouses were
guilty of negligence in the selection and supervision of their employees.
Petitioners countered that the proximate cause of the death and injuries sustained
by the passengers of both vehicles was the recklessness of Boyet Dolor, the driver
of the owner-type jeepney, who was driving in a zigzagging manner under the
influence of alcohol. Petitioners also alleged that Gonzales was not the driver-
employee of the Hernandez spouses as the former only leased the passenger
jeepney on a daily basis. The Hernandez spouses further claimed that even if an
employer-employee relationship is found to exist between them, they cannot be
held liable because as employers they exercised due care in the selection and
supervision of their employee.
During the trial of the case, it was established that the drivers of the two vehicles
were duly licensed to drive and that the road where the collision occurred was
asphalted and in fairly good condition. The owner-type jeep was travelling uphill
while the passenger jeepney was going downhill. It was further established that the
owner-type jeep was moderately moving and had just passed a road bend when its
passengers, private respondents Joseph Sandoval and Rene Castillo, saw the
passenger jeepney at a distance of three meters away. The passenger jeepney was
traveling fast when it bumped the owner type jeep. Moreover, the evidence
presented by respondents before the trial court showed that petitioner Juan
Gonzales obtained his professional driver's license only on September 24, 1986, or
three months before the accident. Prior to this, he was holder of a student driver's
permit issued on April 10, 1986.

Issue: WON the Court of Appeals was correct when it pronounced the Hernandez
spouses as solidarily liable with Juan Gonzales, although it is of record that they
were not in the passenger jeepney driven by latter when the accident occurred

Ruling: Yes. Court held that an employer-employee relationship exists between the
Hernandez spouses and Julian Gonzales hence making them solidarily liable. The
court was not persuaded when the Hernandez spouses argued that since they were
not inside the jeepney at the time of the collision, the provisions of Article 2180 of
the Civil Code, which does not provide for solidary liability between employers and
employees, should be applied.
Article 2180 provides:
ARTICLE 2180.The obligation imposed by article 2176 is demandable not only for
one's own acts or omissions, but also for those of persons for whom one is
responsible.
The father and, in case of his death or incapacity, the mother, are responsible for
the damages caused by the minor children who live in their company.
Guardians are liable for damages caused by the minors or incapacitated persons
who are under their authority and live in their company.
The owners and managers of an establishment or enterprise are likewise
responsible for damages caused by their employees in the service of the branches
in which the latter are employed or on the occasion of their functions.
Employers shall be liable for the damages caused by their employees and
household helpers acting within the scope of their assigned tasks, even though the
former are not engaged in any business or industry.

The responsibility treated of in this article shall cease when the persons herein
mentioned prove that they observed all the diligence of a good father of a family to
prevent damage.

On the other hand, Article 2176 provides

Whoever by act or omission causes damage to another, there being fault or
negligence, is obliged to pay for the damage done. Such fault or negligence, if there
is no pre-existing contractual relation between the parties, is called a quasi-delict
and is governed by the provisions of this Chapter. ICTcD
A
While the above provisions of law do not expressly provide for solidary liability, the
same can be inferred from the wordings of the first paragraph of Article 2180 which
states that the obligation imposed by article 2176 is demandable not only for one's
own acts or omissions, but also for those of persons for whom one is responsible.
Moreover, Article 2180 should be read with Article 2194 of the same Code, which
categorically states that the responsibility of two or more persons who are liable for
quasi-delict is solidary. In other words, the liability of joint tortfeasors is solidary.
Verily, under Article 2180 of the Civil Code, an employer may be held solidarily
liable for the negligent act of his employee.

The solidary liability of employers with their employees for quasi-delicts having
been established, the next question is whether Julian Gonzales is an employee of
the Hernandez spouses. An affirmative answer will put to rest any issue on the
solidary liability of the Hernandez spouses for the acts of Julian Gonzales. The
Hernandez spouses maintained that Julian Gonzales is not their employee since
their relationship relative to the use of the jeepney is that of a lessor and a lessee.
They argue that Julian Gonzales pays them a daily rental of P150.00 for the use of
the jeepney. In essence, petitioners are practicing the "boundary system" of
jeepney operation albeit disguised as a lease agreement between them for the use
of the jeepney.

EASTERN SHIPPING LINES vs INTERMEDIATE APPELLATE COURT

Facts: sometime in or prior to June, 1977, the M/S ASIATICA, a vessel operated by
petitioner Eastern Shipping Lines, Inc., loaded at Kobe, Japan for transportation to
Manila, 5,000 pieces of calorized lance pipes in 28 packages consigned to Philippine
Blooming Mills Co., Inc., and 7 cases of spare parts, consigned to Central Textile
Mills, Inc. Both sets of goods were insured against marine risk for their stated value
with respondent Development Insurance and Surety Corporation. Enroute for Kobe,
Japan, to Manila, the vessel caught fire and sank, resulting in the total loss of ship
and cargo. The respective respondent Insurers paid the corresponding marine
insurance values to the consignees concerned and were thus subrogated unto the
rights of the latter as the insured.

On May 11, 1978, respondent Development Insurance & Surety Corporation, having
been subrogated unto the rights of the two insured companies, filed suit against
petitioner Carrier for the recovery of the amounts it had paid to the insured before
the then Court of First instance of Manila. Petitioner-Carrier denied liability mainly on
the ground that the loss was due to an extraordinary fortuitous event, hence, it is
not liable under the law. On August 31, 1979, the Trial Court rendered judgment in
favor of Development Insurance in the amounts of P256,039.00 and P92,361.75,
respectively, with legal interest, plus P35,000.00 as attorney's fees and costs.
Petitioner Carrier took an appeal to the then Court of Appeals which, on August 14,
1984, affirmed. Petitioner Carrier is now before us on a Petition for Review on
Certiorari.

Issue: which law should govern the Civil Code provisions on Common carriers or
the Carriage of Goods by Sea Act?
Held: 1) The law of the country to which the goods are to be transported governs
the liability of the common carrier in case of their loss, destruction or deterioration.
As the cargoes in question were transported from Japan to the Philippines, the
liability of Petitioner Carrier is governed primarily by the Civil Code. However, in all
matters not regulated by said Code, the rights and obligations of common carrier
shall be governed by the Code of Commerce and by special laws. Thus, the Carriage
of Goods by Sea Act, a special law, is suppletory to the provisions of the Civil Code.

(2) Under the Civil Code, common carriers, from the nature of their business and for
reasons of public policy, are bound to observe extraordinary diligence in the
vigilance over goods, according to all the circumstances of each case. Common
carriers are responsible for the loss, destruction, or deterioration of the goods
unless the same is due to any of the following causes only:
(1) Flood, storm, earthquake, lightning or other natural disaster or calamity;

Petitioner Carrier claims that the loss of the vessel by fire exempts it from liability
under the phrase "natural disaster or calamity. However, the Court said that fire
may not be considered a natural disaster or calamity. This must be so as it arises
almost invariably from some act of man or by human means. It does not fall within
the category of an act of God unless caused by lightning or by other natural disaster
or calamity. It may even be caused by the actual fault or privity of the carrier.
As the peril of the fire is not comprehended within the exception in Article 1734,
supra, Article 1735 of the Civil Code provides that all cases than those mention in
Article 1734, the common carrier shall be presumed to have been at fault or to have
acted negligently, unless it proves that it has observed the extraordinary diligence
required by law.
And even if fire were to be considered a "natural disaster" within the meaning of
Article 1734 of the Civil Code, it is required under Article 1739 of the same Code
that the "natural disaster" must have been the "proximate and only cause of the
loss," and that the carrier has "exercised due diligence to prevent or minimize the
loss before, during or after the occurrence of the disaster. This Petitioner Carrier
has also failed to establish satisfactorily.

In the case at bar, the shipper opted to ship the goods in two containers, and paid
freight charges based on the freight unit, i.e., cubic meters. The shipper did not
declare the value of the shipment, for that would have entailed higher freight
charges; instead of paying higher freight charges, the shipper protected itself by
insuring the shipment. As subrogee, the insurance company can recover from the
carrier only what the shipper itself is entitled to recover, not the amount it actually
paid the shipper under the insurance policy. In our view, under the circumstances,
the container should be regarded as the shipping unit or "package" within the
purview of COGSA. However, we realize that this may not be equitable as far as the
shipper is concerned. If the container is not regarded as a "package" within the
terms of COGSA, then, the $500.00 liability limitation should be based on "the
customary freight unit." Sec. 4 (5) of COGSA provides that in case of goods not
shipped in packages, the limit of the carrier's liability shall be $500.00 "per
customary freight unit." In the case at bar, the petitioner's liability for the shipment
in question based on "freight unit" would be $21,950.00 for the shipment of 43.9
cubic meters.
NATIONAL DEVELOPMENT COMPANY vs CA

Facts: A memorandum agreement entered into between defendants NDC and MCP
on September 13, 1962, defendant NDC as the first preferred mortgagee of three
ocean going vessels including one with the name 'Dona Nati' appointed defendant
MCP as its agent to manage and operate said vessel for and in its behalf and
account. Thus, on February 28, 1964 the E. Philipp Corporation of New York loaded
on board the vessel "Dona Nati" at San Francisco, California, a total of 1,200 bales
of American raw cotton consigned to the order of Manila Banking Corporation,
Manila and the People's Bank and Trust Company acting for and in behalf of the Pan
Asiatic Commercial Company, Inc., who represents Riverside Mills Corporation. Also
loaded on the same vessel at Tokyo, Japan, were the cargo of Kyokuto Boekui, Kaisa,
Ltd., consigned to the order of Manila Banking Corporation consisting of 200 cartons
of sodium lauryl sulfate and 10 cases of aluminum foil. En route to Manila the vessel
Dofia Nati figured in a collision at 6:04 a.m. on April 15, 1964 at Ise Bay, Japan with
a Japanese vessel 'SS Yasushima Maru' as a result of which 550 bales of aforesaid
cargo of American raw cotton were lost and/or destroyed, of which 535 bales as
damaged were landed and sold on the authority of the General Average Surveyor
for Yen 6,045,-500 and 15 bales were not landed and deemed lost.

Plaintiff as insurer, paid to the Riverside Mills Corporation as holder of the

negotiable bills of lading duly endorsed. Also, considered the total loss which the
plaintiff as insurer paid to Guilcon as holder of the duly endorsed bill of lading.
Hence, plaintiff filed this complaint to recover said amount from the defendants-
NDC and MCP as owner and ship agent respectively, of the said 'Dofia Nati' vessel.

Issue: which laws govern loss or destruction of goods due to collision of vessels
outside Philippine waters?

Held: Civil Code. "that the law of the country to which the goods are to be
transported governs the liability of the common carrier in case of their loss,
destruction or deterioration" (Article 1753, Civil Code). Thus, the rule was
specifically laid down that for cargoes transported from Japan to the Philippines, the
liability of the carrier is governed primarily by the Civil Code and in all matters not
regulated by said Code, the rights and obligations of common carrier shall be
governed by the Code of commerce and by laws (Article 1766, Civil Code). Hence,
the Carriage of Goods by Sea Act, a special law, is merely suppletory to the
provision of the Civil Code.

Under Article 1733 of the Civil Code, common carriers from the nature of their
business and for
reasons of public policy are bound to observe extraordinary diligence in the
vigilance over the
goods and for the safety of the passengers transported by them according to all
circumstances of
each case.

Significantly, under the provisions of the Code of Commerce, particularly Articles

826 to 839, the shipowner or carrier, is not exempt from liability for damages arising
from collision due to the fault or negligence of the captain. Primary liability is
imposed on the shipowner or carrier in recognition of the universally accepted
doctrine that the shipmaster or captain is merely the representative of the owner
who has the actual or constructive control over the conduct of the voyage.

There is, therefore, no room for NDC's interpretation that the Code of Commerce
should apply only
to domestic trade and not to foreign trade. Aside from the fact that the Carriage of
Goods by Sea
Act (Com. Act No. 65) does not specifically provide for the subject of collision, said
Act in no
uncertain terms, restricts its application "to all contracts for the carriage of goods by
sea to and
from Philippine ports in foreign trade."

MANAY vs CEBU AIR

Facts:

Carlos S. Jose purchased 20 Cebu Pacific round-trip tickets from Manila to Palawan
for himself and on behalf of his relatives and friends. His preferred date and time of
departure from Manila to Palawan should be on July 20, 2008 at 8:20 a.m. and that
his preferred date and time for their flight back to Manila should be on July 22, 2008
at 4:15 p.m. He alleged that after paying for the tickets, Alou printed the tickets,
which consisted of 3 pages, and recapped only the first page to him. Since the first
page contained the details he specified to Alou, he no longer read the other pages
of the flight information. During the processing of their boarding passes for their
flight back in Manila, they were informed by Cebu Pacific personnel that 9 of them
could not be admitted because their tickets were for 10:05 a.m. flight earlier that
day. Upon checking the tickets, they learned that only the first 2 pages had the
schedule Jose specified. Cebu Pacific essentially denied all the allegations in the
Complaint and insisted that Jose was given a full recap of the tickets. It also argued
that Jose had possession of the tickets 37 days before the scheduled flight; hence,
he had sufficient time and opportunity to check the flight information and itinerary.
Jose argued that Cebu Pacific is a common carrier obligated to exercise
extraordinary diligence to carry Jose, to their destination at the time clearly
instructed to its ticketing agent. They argue that they should not have to ask for a
full recap of the tickets since they are under no obligation, as passengers, to remind
Cebu Pacific's ticketing agent of her duties.

Issue: W/N respondent Cebu Air, Inc. is liable to petitioners for the issuance of a
plane ticket with an allegedly erroneous flight schedule?

Held: No. Air passengers has the correlative duty to exercise ordinary care in the
conduct of his or her affairs. The passenger is still expected to read through the
flight information in the contract of carriage before making his or her purchase. If he
or she fails to exercise the ordinary diligence expected of passengers, any resulting
damage should be borne by the passenger. The obligation of the airline to exercise
extraordinary diligence commences upon the issuance of the contract of carriage.
Ticketing, as the act of issuing the contract of carriage, is necessarily included in the
exercise of extraordinary diligence.
BRITISH AIRWAYS vs COURT OF APPEALS and FITGS

Facts:
February 15, 1981: First International Trading and General Services Co. (First
Int'l), a duly licensed domestic recruitment and placement agency, received a telex
message from its principal ROLACO Engineering and Contracting Services (ROLACO)
in Jeddah, Saudi Arabia to recruit Filipino contract workers in its behalf
Early March 1981: ROLACO paid British Airways, Inc. (BA) Jeddah branch the
airfare tickets for 93 contract workers with specific instruction to transport the
workers to Jeddah on or before March 30, 1981
As soon as BA received a prepaid ticket advice from its Jeddah branch
informed First Int'l.
Thereafter, First Int'l instructed ADB Travel and Tours. Inc. (its travel agent) to
book the 93 workers with BA but it failed
So First Int'l had to borrow P304,416.00 for the purchase of airline tickets
from the other airlines for the 93 workers who must leave immediately since the
visas are valid only for 45 days and the Bureau of Employment Services mandates
that contract workers must be sent to the job site within a period of 30 days
First week of June, 1981: First Int'l was again informed by BA that it had
received a prepaid ticket advice from its Jeddah branch for the transportation of 27
contract workers.
Immediately, First Int'l instructed its ADB to book the 27 contract workers
with the BA but only 16 seats were confirmed and booked on its June 9, 1981 flight.
June 9, 1981: only 9 workers were able to board said flight while the
remaining 7 workers were rebooked to:
June 30, 1981 - again cancelled by British without any prior notice to either
First Int'l or the workers
July 4,1981 - (6 + 7 workers) 13 workers were again cancelled and rebooked
to July 7, 1981.
July 6, 1981: First Int'l paid the travel tax of the workers as required by BA
but when the receipt of the tax payments was submitted, only 12 seats were
confirmed for July 7, 1981 flight
July 7, 1981: Flight was again cancelled without any prior notice
12 workers were finally able to leave for Jeddah after First Int'l had bought
tickets from the other airlines
As a result of these incidents, First Int'l sent a letter to BA demanding
compensation for the damages it had incurred by the repeated failure to transport
its contract workers despite confirmed bookings and payment of the corresponding
travel taxes.
July 23, 1981: the counsel of First Int'l sent another letter to BA demanding
P350,000.00 damages and unrealized profit or income - denied
August 8, 1981: First Int'l received a telex message from ROLACO cancelling
the hiring of the remaining recruited workers due to the delay in transporting the
workers to Jeddah.
January 27, 1982: First Int'l filed a complaint for damages against First Int'l
CA Affirmed RTC: BA to pay First Int'l damages, attorneys fees and costs
Issue: W/N BA is not liable because there was no contract of carriage as no ticket
was ever issued.

Held: In dealing with the contract of common carriage of passengers for purpose of
accuracy, there are two (2) aspects of the same, namely: (a) the contract "to carry
(at some future time)," which contract is consensual and is necessarily perfected by
mere consent (See Article 1356), and (b) the contract "of carriage" or "of common
carriage" itself which should be considered as a real contract for not until the carrier
is actually used can the carrier be said to have already assumed the obligation of a
carrier. In the instant case, the contract "to carry" is the one involved which is
consensual and is perfected
by the mere consent of the parties. There is no dispute as to the appellee's consent
to the said contract "to carry" its contract workers from Manila to Jeddah. The
appellant's consent thereto, on the other hand, was manifested by its acceptance of
the PTA or prepaid ticket advice that ROLACO Engineering has prepaid the airfares
of the appellee's contract workers advising the appellant that it must transport the
contract workers on or before the end of March, 1981 and the other batch in June,
1981.

Accordingly, there could be no more pretensions as to the existence of an oral

contract of carriage
imposing reciprocal obligations on both parties. In the case of appellee, it has fully
complied with the obligation, namely, the payment of the fare and its willingness for
its contract workers to leave for their place of destination.