CD: National Steel Corporation v. CA

September 17, 2010 at 5:55 pm (1997, Case Digests) (, , )

NATIONAL STEEL CORPORATION v. COURT OF APPEALS
G.R. No. 112287 December 12, 1997
Panganiban, J.

Doctrine:
The stringent provisions of the Civil Code on common carriers protecting the general public cannot justifiably be applied to a private carrier.

Facts:
Plaintiff National Steel Corporation (NSC) as Charterer and defendant Vlasons Shipping, Inc. (VSI) as Owner, entered into a Contract of Voyage Charter Hire whereby NSC hired VSI’s vessel, the MV Vlasons I to make one voyage to load steel products at Iligan City and discharge them at North Harbor, Manila. The handling, loading and unloading of the cargoes were the responsibility of the Charterer.

The skids of tinplates and hot rolled sheets shipped were allegedly found to be wet and rusty. Plaintiff, alleging negligence, filed a claim for damages against the defendant who denied liability claiming that the MV Vlasons I was seaworthy in all respects for the carriage of plaintiff’s cargo; that said vessel was not a “common carrier” inasmuch as she was under voyage charter contract with the plaintiff as charterer under the charter party; that in the course its voyage, the vessel encountered very rough seas.

Issue:
Whether or not the provisions of the Civil Code on common carriers pursuant to which there exists a presumption of negligence against the common carrier in case of loss or damage to the cargo are applicable to a private carrier.

Held:
No. In a contract of private carriage, the parties may freely stipulate their duties and obligations which perforce would be binding on them. Unlike in a contract involving a common carrier, private carriage does not involve the general public. Hence, the stringent provisions of the Civil Code on common carriers protecting the general public cannot justifiably be applied to a ship transporting commercial goods as a private carrier.

It has been held that the true test of a common carrier is the carriage of passengers or goods, provided it has space, for all who opt to avail themselves of its transportation service for a fee [Mendoza vs. Philippine Airlines, Inc., 90 Phil. 836, 842-843 (1952)]. A carrier which does not qualify under the above test is deemed a private carrier. “Generally, private carriage is undertaken by special agreement and the carrier does not hold himself out to carry goods for the general public.

Because the MV Vlasons I was a private carrier, the ship owner’s obligations are governed by the foregoing provisions of the Code of Commerce and not by the Civil Code which, as a general rule, places the prima facie presumption of negligence on a common carrier.

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