FIRST DIVISION.
.
PHILIPPINE
AMERICAN
GENERAL INSURANCE
COMPANY,
Petitioner,
G.R.
No.
149038
April 9, 2003
-versus-
PKS SHIPPING
COMPANY,
Respondent. D E C I S I O N
VITUG,
J.:
The petition before the
Court seeks a review of the decision of the Court of Appeals in C.A.
G.R.
CV No. 56470, promulgated on 25 June 2001, which has affirmed in toto
the
judgment of the Regional Trial Court (RTC), Branch 65, of Makati,
dismissing
the complaint for damages filed by petitioner insurance corporation
against
respondent shipping company.chanrobles virtuallaw libraryred
Davao Union Marketing
Corporation (DUMC) contracted the services of respondent PKS Shipping
Company
(PKS Shipping) for the shipment to Tacloban City of seventy-five
thousand
(75,000) bags of cement worth Three Million Three Hundred Seventy-Five
Thousand Pesos (P3,375,000.00). DUMC insured the goods for its
full
value with petitioner Philippine American General Insurance Company
(Philamgen).
The goods were loaded aboard the dumb barge Limar I belonging to PKS
Shipping.
On the evening of 22 December 1988, about nine o’clock, while Limar I
was
being towed by respondent’s tugboat, MT Iron Eagle, the barge
sank
a couple of miles off the coast of Dumagasa Point, in Zamboanga del
Sur,
bringing down with it the entire cargo of 75,000 bags of cement.
chanrobles virtuallaw libraryred
DUMC filed a formal
claim with Philamgen for the full amount of the insurance.
Philamgen
promptly made payment; it then sought reimbursement from PKS Shipping
of
the sum paid to DUMC but the shipping company refused to pay, prompting
Philamgen to file suit against PKS Shipping with the Makati RTC.
chanrobles virtuallaw libraryred
The RTC dismissed the
complaint after finding that the total loss of the cargo could have
been
caused either by a fortuitous event, in which case the ship owner was
not
liable, or through the negligence of the captain and crew of the vessel
and that, under Article 587 of the Code of Commerce adopting the
"Limited
Liability Rule," the ship owner could free itself of liability by
abandoning,
as it apparently so did, the vessel with all her equipment and earned
freightage.
chanrobles virtuallaw libraryred
Philamgen interposed
an appeal to the Court of Appeals which affirmed in toto the decision
of
the trial court. The appellate court ruled that evidence to
establish
that PKS Shipping was a common carrier at the time it undertook to
transport
the bags of cement was wanting because the peculiar method of the
shipping
company’s carrying goods for others was not generally held out as a
business
but as a casual occupation. It then concluded that PKS Shipping,
not being a common carrier, was not expected to observe the stringent
extraordinary
diligence required of common carriers in the care of goods. The
appellate
court, moreover, found that the loss of the goods was sufficiently
established
as having been due to fortuitous event, negating any liability on the
part
of PKS Shipping to the shipper.chanrobles virtuallaw libraryred
In the instant appeal,
Philamgen contends that the appellate court has committed a patent
error
in ruling that PKS Shipping is not a common carrier and that it is not
liable for the loss of the subject cargo. The fact that
respondent
has a limited clientele, petitioner argues, does not militate against
respondent’s
being a common carrier and that the only way by which such carrier can
be held exempt for the loss of the cargo would be if the loss were
caused
by natural disaster or calamity. Petitioner avers that typhoon
"APIANG"
has not entered the Philippine area of responsibility and that, even if
it did, respondent would not be exempt from liability because its
employees,
particularly the tugmaster, have failed to exercise due diligence to
prevent
or minimize the loss.chanrobles virtuallaw libraryred
PKS Shipping, in its
comment, urges that the petition should be denied because what
Philamgen
seeks is not a review on points or errors of law but a review of the
undisputed
factual findings of the RTC and the appellate court. In any
event,
PKS Shipping points out, the findings and conclusions of both courts
find
support from the evidence and applicable jurisprudence.chanrobles virtuallaw libraryred
The determination of
possible liability on the part of PKS Shipping boils down to the
question
of whether it is a private carrier or a common carrier and, in either
case,
to the other question of whether or not it has observed the proper
diligence
(ordinary, if a private carrier, or extraordinary, if a common carrier)
required of it given the circumstances.chanrobles virtuallaw libraryred
The findings of fact
made by the Court of Appeals, particularly when such findings are
consistent
with those of the trial court, may not at liberty be reviewed by this
Court
in a petition for review under Rule 45 of the Rules of Court.[1]
The conclusions derived from those factual findings, however, are not
necessarily
just matters of fact as when they are so linked to, or inextricably
intertwined
with, a requisite appreciation of the applicable law. In such
instances,
the conclusions made could well be raised as being appropriate issues
in
a petition for review before this Court. Thus, an issue whether a
carrier is private or common on the basis of the facts found by a trial
court or the appellate court can be a valid and reviewable question of
law.chanrobles virtuallaw libraryred
The Civil Code defines
"common carriers" in the following terms:chanrobles virtuallaw libraryred
"Article 1732. Common
carriers are 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."chanrobles virtuallaw libraryred
Complementary to the
codal definition is Section 13, paragraph (b), of the Public Service
Act;
it defines "public service" to be –
chanrobles virtuallaw libraryred
"x x x every person
that now or hereafter may own, operate, manage, or control in the
Philippines,
for hire or compensation, with general or limited clientele, whether
permanent,
occasional or accidental, and done for general business purposes, any
common
carrier, railroad, street railway, subway motor vehicle, either for
freight
or passenger, or both, with or without fixed route and whatever may be
its classification, freight or carrier service of any class, express
service,
steamboat, or steamship, or steamship line, pontines, ferries and water
craft, engaged in the transportation of passengers or freight or both,
shipyard, marine repair shop, wharf or dock, ice plant, ice
refrigeration
plant, canal, irrigation system, gas, electric light, heat and power,
water
supply and power petroleum, sewerage system, wire or wireless
communication
systems, wire or wireless broadcasting stations and other similar
public
services. x x x. (Underscoring supplied)."chanrobles virtuallaw libraryred
The prevailing doctrine
on the question is that enunciated in the leading case of De Guzman vs.
Court of Appeals.[2]
Applying Article 1732 of the Code, in conjunction with Section 13(b) of
the Public Service Act, this Court has held:chanrobles virtuallaw libraryred
"The above article makes
no distinction between one whose principal business activity is the
carrying
of persons or goods or both, and one who does such carrying only as an
ancillary activity (in local idiom, as `a sideline’). Article
1732
also carefully avoids making any distinction between a person or
enterprise
offering transportation service on a regular or scheduled basis and one
offering such service on an occasional, episodic or unscheduled
basis.
Neither does Article 1732 distinguish between a carrier offering its
services
to the `general public,’ i.e., the general community or population, and
one who offers services or solicits business only from a narrow segment
of the general population. We think that Article 1732
deliberately
refrained from making such distinctions.
chanrobles virtuallaw libraryred
"So understood, the
concept of `common carrier’ under Article 1732 may be seen to coincide
neatly with the notion of `public service,’ under the Public Service
Act
(Commonwealth Act No. 1416, as amended) which at least partially
supplements
the law on common carriers set forth in the Civil Code."chanrobles virtuallaw libraryred
Much of the distinction
between a "common or public carrier" and a "private or special carrier"
lies in the character of the business, such that if the undertaking is
an isolated transaction, not a part of the business or occupation, and
the carrier does not hold itself out to carry the goods for the general
public or to a limited clientele, although involving the carriage of
goods
for a fee,[3]
the person or corporation providing such service could very well be
just
a private carrier. A typical case is that of a charter party
which
includes both the vessel and its crew, such as in a bareboat or demise,
where the charterer obtains the use and service of all or some part of
a ship for a period of time or a voyage or voyages[4]
and gets the control of the vessel and its crew.[5]
Contrary to the conclusion made by the appellate court, its factual
findings
indicate that PKS Shipping has engaged itself in the business of
carrying
goods for others, although for a limited clientele, undertaking to
carry
such goods for a fee. The regularity of its activities in this
area
indicates more than just a casual activity on its part.[6]
Neither can the concept of a common carrier change merely because
individual
contracts are executed or entered into with patrons of the
carrier.
Such restrictive interpretation would make it easy for a common carrier
to escape liability by the simple expedient of entering into those
distinct
agreements with clients.
chanrobles virtuallaw libraryred
Addressing now the
issue of whether or not PKS Shipping has exercised the proper diligence
demanded of common carriers, Article 1733 of the Civil Code requires
common
carriers to observe extraordinary diligence in the vigilance over the
goods
they carry. In case of loss, destruction or deterioration of
goods,
common carriers are presumed to have been at fault or to have acted
negligently,
and the burden of proving otherwise rests on them.[7]
The provisions of Article 1733, notwithstanding, common carriers are
exempt
from liability for loss, destruction, or deterioration of the goods due
to any of the following causes:
chanrobles virtuallaw libraryred
(1) Flood, storm,
earthquake,
lightning, or other natural disaster or calamity;chanrobles virtuallaw libraryred
(2) Act of the public
enemy in war, whether international or civil;chanrobles virtuallaw libraryred
(3) Act or omission
of the shipper or owner of the goods;chanrobles virtuallaw libraryred
(4) The character of
the goods or defects in the packing or in the containers; andchanrobles virtuallaw libraryred
(5) Order or act of
competent public authority.[8]chanrobles virtuallaw libraryred
The appellate court
ruled, gathered from the testimonies and sworn marine protests of the
respective
vessel masters of Limar I and MT Iron Eagle, that there was no way by
which
the barge’s or the tugboat’s crew could have prevented the sinking of
Limar
I. The vessel was suddenly tossed by waves of extraordinary
height
of six (6) to eight (8) feet and buffeted by strong winds of 1.5 knots
resulting in the entry of water into the barge’s hatches. The
official
Certificate of Inspection of the barge issued by the Philippine
Coastguard
and the Coastwise Load Line Certificate would attest to the
seaworthiness
of Limar I and should strengthen the factual findings of the appellate
court.chanrobles virtuallaw libraryred
Findings of fact of
the Court of Appeals generally conclude this Court; none of the
recognized
exceptions from the rule - (1) when the factual findings of the
Court
of Appeals and the trial court are contradictory; (2) when the
conclusion
is a finding grounded entirely on speculation, surmises, or
conjectures;
(3) when the inference made by the Court of Appeals from its
findings
of fact is manifestly mistaken, absurd, or impossible; (4) when
there
is a grave abuse of discretion in the appreciation of facts; (5) when
the
appellate court, in making its findings, went beyond the issues of the
case and such findings are contrary to the admissions of both appellant
and appellee; (6) when the judgment of the Court of Appeals is
premised
on a misapprehension of facts; (7) when the Court of Appeals
failed
to notice certain relevant facts which, if properly considered, would
justify
a different conclusion; (8) when the findings of fact are
themselves
conflicting; (9) when the findings of fact are conclusions
without
citation of the specific evidence on which they are based; and
(10)
when the findings of fact of the Court of Appeals are premised on the
absence
of evidence but such findings are contradicted by the evidence on
record
- would appear to be clearly extant in this instance.chanrobles virtuallaw libraryred
All given then, the
appellate court did not err in its judgment absolving PKS Shipping from
liability for the loss of the DUMC cargo.chanrobles virtuallaw libraryred
WHEREFORE, the petition
is denied. No costs.cralaw:red
SO ORDERED.chanrobles virtuallaw libraryred
Davide, Jr., C.J.,
(Chairman), Ynares-Santiago, Carpio, and Azcuna, JJ.,
concur.chan
robles virtual law library
____________________________
Endnotes:
[1]
National Steel Corporation vs. Court of Appeals, 283 SCRA 45.
[2]
168 SCRA 612.chanrobles virtuallaw libraryred
[3]
Planters Products, Inc. vs. Court of Appeals, G.R. No. 101503, 15
September
1993, 226 SCRA 476.
[4]
National Steel Corporation vs. Court of Appeals, G.R. No. 112287, 12
December
1997, 283 SCRA 45.
[5]
National Steel Corporation vs. Court of Appeals, G.R. No. 112287, 12
December
1997, 283 SCRA 45.
[6]
The testimony of respondent’s own witness, Capt. Andres Elbena, is
quite
revealing. He testified that he had been working for respondent
as
tugmaster for the past twenty-five (25) years and that the company owns
several vessels.chanrobles virtuallaw libraryred
[7]
Article 1735, Civil Code of the Philippines.chanrobles virtuallaw libraryred
[8]
Article 1734, Civil Code of the Philippines.chanrobles virtuallaw libraryred |