UNIVERSITY OF THE PHILIPPINES COLLEGE OF LAW TRANSPORTATION AND PUBLIC UTILITY LAW First Semester, AY 2013-2014 Prof.

Nicholas Felix L. Ty BASIS FOR EVALUATION Recitation: Final Examination: Attendance: Total: Fifty Percent (50%) Forty-Five Percent (45%) Five Percent (5%) One Hundred Percent (100%)

GRADE EQUIVALENTS

Score 97-100 94-96 90-93 87-89 83-86 80-82 77-79 74-76 70-73 0-69

Grade Equivalent 1.00 1.25 1.50 1.75 2.00 2.25 2.50 2.75 3.00 5.00

TENTATIVE SCHEDULE Inclusive Dates 06 -10 June 2013 13 June 01 July 2013 04 - 22 July 2013 25 July - 02 September 2013 05-09 September 2013 05 September 24 September 2013 26-30 September 2013 As scheduled No. of Meetings 1 3 3 6 1 3 1 Topic Introduction and Orientation Public Utilities Transportation Law Parts I and II Common Carriers Code of Commerce Provisions on Overland Transport Admiralty and Maritime Commerce Part V of Course Outline: International Air Transport Final Examination

REFERENCES: Agbayani, Aguedo F., Commentaries & Jurisprudence on the Commercial Laws of the Philippines Aquino, Timoteo B. & Hernando, Ramon Paul L., Notes and Cases on the Law of Transportation and Public Utilities

COURSE OUTLINE1 PART ONE: PUBLIC UTILITIES I. General Discussion

A. What is a public utility? Munn v Illinois, 94 U.S. 113 (1876) Luzon Stevedoring Co., Inc. v. PSC, G.R. No L-5458. September 16, 1953 KMU Labor Center v. Garcia, 239 SCRA 386

Additional Readings: Millar, Edythe S., Is the Public Utility Concept Obsolete?, Land Economics, Vol. 71, No. 3, Social Control of Private Power: The Past and Future of Public Utility Regulation (August 1995), pp. 273-285 Gray, Horace M., The Passing of the Public Utility Concept, The Journal of Land & Public Utility Economics, Vol. 16, No. 1 (February 1940), pp 8 -20 Batson, H.E., The Economic Concept of a Public Utility, Economica, No. 42 (November 1933), pp 457-472.

B. What is a public service? Commonwealth Act No. 146 or the Public Service Act, as amended, Sec 13(b) Differentiate public utility from public service? C. Legal Basis and Rationale for Regulation Republic of the Philippines v. Meralco, 391 SCRA 700

D. Where does the Power to Regulate Public Utilities Reside? The original version of this course outline was patterned after the course outline of Prof. Rodrigo Lope S. Quimbo. Additions and amendments to the original outline are in italics.
1

Albano v. Reyes, 175 SCRA 264 KMU Labor Center v. Garcia, supra Agan v. Piatco, G.R. No. 155001, January 21, 2004 Batangas CATV v. Court of Appeals, G.R. No. 138819, September 29, 2004

Relate to Public Service Act 13(a) What happened to the Public Service Commission? See footnote #2 in KMU Labor Center v. Garcia, supra, E. Not a Public Utility Tatad v. Garcia, 243 SCRA 436 Teresa Electric & Power Co. v PSC, 21 SCRA 198

See Public Service Act, Sec. 14 for list of enterprises not covered by definition of public service Nature of concession agreements Freedom from Debt Coalition v. MWSS, G.R. No. 173044, December 10, 2007

II.

Constitutional Provisions See Article XII, Secs. 6, 11, 17, 18, 19, 1987 Constitution a. Ownership Gamboa v. Teves, G.R. No. 176579, June 28, 2011 Gamboa v. Teves, G.R. No. 176579, October 9, 2012 Relate to Public Service Act, Sec 16 (a) and Sec. 20 (i) b. Exclusivity Metro Cebu Water v. Adala, G.R. No. 168914, July 4, 2007 Tawang Multi-Purpose Cooperative v. La Trinidad Water District, G.R. No. 166471, March 22, 2011

c. Subject to Amendment RCPI v NTC, 150 SCRA 450 Relate to Public Service Act, Sec. 16 (m) and (n) d. Take-over Power David v. Macapagal-Arroyo, G.R. No, 171396, May 3, 2006 Agan v. Piatco, supra e. Privatization of State-Operated Public Utilities Kuwait Airways v. Philippine Airlines, G.R. No. 156087, May 8, 2009

III.

Regulation of Public Utilities A. Authority to Operate Albano v. Reyes, 175 SCRA 264 PLDT v NTC, G.R. No. 88404, October 18, 1990 Francisco v. Toll Regulatory Board, G.R. No. 166910, October 19, 2010 Napocor v. Court of Appeals, 279 SCRA 408 Relate to Public Service Act, Section 16 (a), Sec. 18 i. General Qualifications

Vda. de Lat v. PSC, G.R. No. L-34978, Feb. 26, 1988 KMU Labor Center v. Garcia, supra ii. Revocation or Cancellation Divinagracia v Consolidated Broadcasting System, Inc. G.R. No 162272, April 7, 2009

Relate to Public Service Act, Section 16(m)

iii.

CPC v. CPCN

See Public Service Act, Section 15 PAL v. CAB, 270 SCRA 538 (see also Republic Acts No. 9183 and 9517 in relation to case)

B. Rate-Fixing See Public Service Act, Sections 16(c) and 20(a) o Padua v. Ranada, G.R. No. 141949, October 14, 2002 o Republic of the Philippines v. Meralco, supra o KMU Labor Center v. Garcia, supra o Francisco v. Toll Regulatory Board, supra C. Approval of Sales of Public Utility Assets or Equity Public Service Act, Section 20 (g), (h) and (i) Montoya v. Ignacio, G.R. No. L-5868, December 29, 1953 Perez v. Gutierrez, 53 SCRA 149 D. Power to set fees and other charges Republic v. International Communications Corporation, G.R. No. 141667, July 17, 2006 E. Other means of regulation See Public Service Act, Section 16 and 20 PLDT v NTC, supra

PART TWO: TRANSPORATION LAW I General Discussion 1. Definition 2. Relationship to a public utility 3. Nature of a Franchise Raymundo v. Luneta Motor, 58 Phil. 889 Cogeo-Cubao Operator & Driver Association v. CA, G.R. No. 100727, March 18, 1992 Y Transit Co., Inc. v. NLRC, 229 SCRA 508 4. Scope of a Franchise San Pablo v. Pantranco, 153 SCRA 199

5. Prior-operator rule Batangas Transportation v. Orlanes, 52 Phil 455 6. Kabit System Teja v. IAC, 148 SCRA 347 Lita Enterprises, Inc. v. Second Civil Cases Division, 129 SCRA 79 Lim v. CA, G.R. No. 125817, January 16, 2002 Baliwag Transit, Inc. v Court of Appeals, G.R. No. L57493, January 7, 1987

7. Private nature; rights and obligations of parties inter se arising from transactions relating to transportation a. absent a transportation contract Lara v Valencia, 104 Phil 65

b. liability of registered owner PCI Leasing v UCPB General Insurance, 557 SCRA 141

II Regulation of the Transportation Industry 1. The Department of Transportation and Communication, EO 125, Sec. 4 and 5 (as amended by EO 125-A); See also EO 292 Book IV, Title XV a. Air (i) Civil Aviation Authority of the Philippines, Republic Act No. 9497 (2008), Sec. 4, 21, 24, 35 Civil Aeronautics Board, RA 776, as amended, Secs. 5, 10 (A), (C); Secs. 11,12 PAL v. CAB, 23 SCRA 992 PAL v. CAB, supra Kuwait Airways v. PAL, supra b. Land (i) Land Transporation Office, EO 125-A, Secs. 9, 11, 13(a); Administrative Code of 1987, Title XV, Sec 9(1) Land Transportation Franchising and Regulatory Board, EO 202, Secs. 1, 2, 4, 5, 6, 7; Administrative Code of 1987, Title XV, Secs. 15-22 KMU Labor Center v. Garcia, supra c. Water (i) Maritime Industry Authority, EO 125, Sec. 14, as amended by EO-125-A, Sec. 4. See also Republic Act No. 9295, Section 10 and 11, in relation to Section 8

(ii)

(ii)

IV.

Common Carriers (Unless otherwise indicated, reference is to the Civil Code) A. In General

1. Definitions, essential elements; Art. 1732 U.S. v. Tan Piaco, 40 Phil 853 Home Insurnace Co. v. American Steamship, 23 SCRA 24 De Guzman v. CA, 168 SCRA 612 Bascos v. CA, 221 SCRA 318 Planters Products Inc. v. Court of Appeals, 226 SCRA 476 Fabre v. Court of Appeals, 259 SCRA 426 First Philippine Industrial Corporation v. Court of Appeals, 300 SCRA 661 Asia Lighterage and Shipping v. Court of Appeals, 409 SCRA 340 Crisostomo v. Court of Appeals, 409 SCRA 528 2. Nature of Business; power of State to regulate Art. 1765 Pantranco v. PSC, 70 Phil 221 3. Nature and Basis of Liability Art. 1733 Cangco v. MRR, 38 Phil 767 Isaac v. A.L. Ammen, 101 Phil 1046 Fores v. Miranda, 105 Phil 266 Phil. Rabbit v. IAC, 189 SCRA 159 LRTA v. Navidad, 397 SCRA 75 4. Classes of common carriers Art. 1732, 1733, 1755 5. Law applicable Arts. 1766, 1753 B. Common Carriage of Goods 1. Liability and presumption of negligence Arts. 1733, 1734, 1735 Ynchausti Steamship Co. v. Dexter, 41 Phil 289 Mirasol v. Dollar, 53 Phil 125 2. Exemption from liability

(a) Natural Disaster Arts. 1734 (1), 1739, 1740; Art. 361, Code of Commerce Tan Chiong v. Inchausti, 22 Phil 153 Martini v. Macondray, 39 Phil. 934 Eastern Shipping v. IAC, 150 SCRA 463 Asia Lighterage v. Court of Appeals, 409 SCRA 340 (b) Act of public enemy Art. 1734(2), 1739 (c) Act or omission of shipper Art. 1734(3), 1741 (d) Character of goods, etc Arts. 1734(4), 1742 Art. 366, Code of Commerce Government v. Ynchausti, 40 Phil 219 Southern Lines v. CA, 4 SCRA 258 (e) Order of competent authority Arts. 1734(5), 1743 Ganzon v. Court of Appeals, 161 SCRA 646 3. Duration of Extraordinary Responsibility Arts. 1736 to 1738 Compania Maritima v. Insurance Company, 12 SCRA 213 Lu Do v. Binamira, 101 Phil 120 APL v. Klepper, 110 Phil. 243 Eastern Shipping v. CA, 234 SCRA 79 4. Agreement Limiting Liability (a) As to diligence required Arts. 1744, 1745, 1751 (b) As to amount of liability Arts. 1749 and 1750 Heacock v. Macondray 42 Phil 205 Shewaram v. PAL 17 SCRA 606 Ong Yiu v. CA, 91 SCRA 223 Pan Am v. IAC, 164 SCRA 268

Cathay Pacific v. CA, 219 SCRA 520 (c) Factor affecting agreement Arts. 1746, 1747, 1748, 1751, 1752, CC

5. Applicable Law in Foreign Trade Art. 1753 6. Rules on Passenger Baggage Arts. 1754, 1998, 2000 to 2003 C. Common Carriage of Passengers 1. Nature and extent of responsibility Arts. 1733, 1755 Isaac v. A.L. Amnen Trans. Co., supra Landingin v. Pantranco 33 SCRA 284 Landicho v. BTCo. 52 OG 7640 Necesito v. Paras 104 Phil 75 PAL v. CA, 106 SCRA 391 Sulpicio v. CA, 246 SCRA 229 Japan Airlines v. Court of Appeals, 449 SCRA 544 2. Duration of responsibility Cf. Article 1736, Civil Code; Article 17, Warsaw Convension (51 O.G. 5084), Article 698, Code of Commerce Cangco v. MRR, supra Del Prado v. Meralco, 52 Phil 900 La Mallorca v. Court of Appeals 17 SCRA 739 Bataclan v. Medina 102 Phil 181 Aboitiz v. CA, 179 SCRA 95 Philippine Airlines v. CA, 226 SCRA 423 3. Presumption of Negligence, Art. 1756 4. Force Majeure Bachelor Express v. CA, 188 SCRA 217 5. Limitation of Liability; validity of stipulations Arts. 1757, 1758

6. Responsibility for acts of employees Arts. 1759, 1760 De Gillaco v. MRR, 97 Phil 884 Maranan v. Perez, 20 SCRA 412 LRTA v. Navidad, supra 7. Responsibility for acts of strangers and co-passengers Arts. 1763 Pilapil v. CA, 180 SCRA 546 Bachelor Express, Inc. v. CA, supra 8. Duty of passenger; effect of contributory negligence Arts. 1761, 1762 Cangco v. MRR, supra Isaac v. A.L. Amnen, supra D. Damages Recoverable from Common Carriers 1. In general 2. Actual or compensatory Arts. 2199,2201,2203,1764,2206 Cariaga v. LTBCo. and MRR, 110 Phil 346 Pan Am v. IAC, supra Villa-Rey v. CA, 31 SCRA 511 PAL v. CA, 185 SCRA 110 Victory Liner v. Gammad, G.R. No, 159636, Nov 25, 2004 3. Moral Arts. 2217, 2216, 2219, 2220,2206(3) Fores v. Miranda, 105 Phil 266 Air France v. Carrascoso, 18 SCRA 155 Lopez v. Pan Am, 16 SCRA 431 Ortigas v. Lufthansa, 64 SCRA 610 PAL v. Miano, 242 SCRA 235 United Airlines v. Court of Appeals, 357 SCRA 99 Cathay Pacific v. Vasquez, 399 SCRA 207 Air France v. Gillego, G.R. No. 165266, December 15, 2010

8. Exemplary Arts. 2229, 2232, 2233 Mecenas v. Court of Appeals, 180 SCRA 83 9. Nominal, Temperate and Liquidated Arts. 2221, 2224, 2226 Alitalia v. AIC, 192 SCRA 9 Saludo v. Court of Appeals, 207 SCRA 498 Japan Airlines v. Court of Appeals, 294 SCRA 19 Savellano v. Northwest, 405 SCRA 416 Victory Liner v Gammad, supra 6. Attorneys Fees and Interest Arts. 2208, 2210 IV. Code of Commerce Provisions on Overland Transportation (Unless otherwise indicated, reference is to Code of Commerce) A. Scope of Overload Transportation B. Nature of Contract, Art. 349 C. Effect of Civil Code Arts. 1766, 2270, Civil Code D. Contract of Carriage 1. Bill of Lading (a) Definition, Subject Matter, Art. 352 (b) Form, Contents, Arts. 350, 351 (c) Function, Art. 353 2. Refusal to Transport, Art. 356 3. Doubtful declaration of contents, Art. 357 4. No Bill of Lading, Art. 354, 51 E. Responsibility of the Carrier 1. When it commences, Art. 355 2. Route, Art. 359 3. Care of Goods, Arts. 361, 362 Arts. 1734, 1735, Civil Code 4. Delivery

(a) Condition of Goods, Arts. 363 to 367 (b) To Whom Delivery Made, Art. 368 (c) When to be made, Arts. 370, 358 F. Rights and Obligations or Shipper and/or Consignee 1. Right to damages (a) Condition imposed on right, Arts. 366, 357 (b) Amount of damages for loss, Art. 732; Art. 1744, Civil Code (c) Amount of Damages for delay, Art. 371(3) 2. Right to abandon, Arts. 371, 360, 365, 363 3. Right to change consignment, Art. 360 4. Obligation to pay transportation charges, Arts. 376; Art. 2241(9), Civil Code 5. Obligation to return bill of lading, Art. 353(2) G. Applicability of Provisions, Art. 379

V.

Admiralty and Maritime Commerce

A. Concept of Admiralty; Jurisdiction over admiralty cases Batas Pambansa Blg. 129, Sec. 19 (3), Sec. 33(1), as amended by R.A. 7691 International Harvester v. Aragon, 84 Phil 363 B. Vessels 1. Meaning Lopez v. Duruelo, 52 Phil 229 E. Nature and acquisition of Arts. 573, 573, 583, Art. 712, Civil Code F. Registration; certificates issued; distinctions Republic Act 9295 Section 10(1) 4. Significance of registration of transactions affecting vessels Arroyo v. Yu, 54 Phil 511

Rubiso v. Rivera, 37 Phil 72 C. Persons Participating in Maritime Commerce 1. Shipowners and shipagents Arts. 586 to 608; 618 Standard Oil v. Castelo, 42 Phil 256 (a) Responsibilities and liabilities Yu Con v. Ipil, 41 Phil 770 Manila Streamship v. Abdulhaman, 100 Phil 32 Wing Kee Compradoring Co. v. Bark Mononhaela, 44 Phil. 464 (b) The doctrine of limited liability, Art. 587 Manila Steamship v. Abdulhaman, supra Yangco v. Laserna, 73 Phil 330 Abueg v. San Diego, 77 Phil 730 Aboitiz Shipping v. General Accident Fire and Life Assurance Corporation, Ltd., 217 SCRA 359 (c) Specific rights and prerogatives Arts. 575, 593, 594, 596, 601 2. Captains and Master (a) Qualifications and licensing Rep. Act 5173, Sec. 3 Art. 609 (b) Powers and Duties Arts. 610, 611, 612, 622, 624, 625 Inter Orient v. NLRC, 235 SCRA 269 (c) Prohibited acts and transactions

Arts. 613, 614, 615, 617, 621, 583 3. Other Officers and Crew

(a) Contracts and formalities, Art. 634 (b) Duties and liabilities, Art. 635 (c) Rights, Arts. 636 to 647 4. Supercargoes, Arts. 649-651

D. Accidents and Damages in Maritime Commerce 1. Averages (a) Nature and Kinds, Arts. 806 to 808 (1) Simple or Particular (a) Defined, Art. 809 (b) Effects, Art. 810 (2) Gross or General (a) Defined, Arts. 811, 817, 818 (b) Essential Requisites, Arts. 813, 814, 860 Magsaysay Inc. v. Agan. 96 Phil 504 (c) Effects, Art. 812 (d) Jettison, Arts. 815, 816 (e) Jason Clauses (See York-Antwerp Rules, Rule D)

2. Arrival Under Stress (a) Causes, Arts. 819 and 820 (b) Formalities, Arts. 819, 822 (c) Expenses, Arts. 821, 822 (d) Responsibility of Captain, Arts. 823 - 825 3. Collisions (a) Classes and Effects (1) Fortuitous, Arts. 830, 832 (2) Culpable, Arts. 826, 827 and 831 (3) Inscrutable Fault, Art. 828

A. Urrutia & Co. v. Baco River Plantation Co., G.R. No. 7675, March 25, 1913 National Development Company v. Court of Appeals, G.R. No. L-49407, August 19, 1988 Government v. Philippine Streamship Co., Inc. G.R. No. 18957, January 16,1923 Smith Bell and Company v. Court of Appeals, G.R. No. 56294, May 20, 1991 4. Shipwrecks, Arts. 840 to 843 (a) Salvage Law (Act No. 2616) G. Urrutia & Company v. The Pasig Steamer and Lighter Co.. G.R. No, 7294, March 22, 1912 Erlanger & Galinger v. Swedish East Asiatic Co. Ltd, 34 Phil 178 Atlantic, Gulf & Pacific Company v Uchida Kisen Kaisha, G.R. No. L15871, November 7, 1921 Barrios v. Go Thong, 7 SCRA 535 E. Special Contracts of Maritime Commerce 1. Charter Parties a. Definition b. Kinds Planters Products v. CA, supra Coastwise Lighterage Corp. v. CA, 245 SCRA 796 Caltex Philippines v. Sulpicio Lines, 315 SCRA 709

2. Loans on Bottomry and Respondentia a. Loan on Bottomry, defined b. Loan on Respondentia, defined c. Character of Loan, Art. 719 F. Bill of Lading 1. Contents, Art. 706, 707,713, 714 2. Probative Value, Arts. 709, 710 G. Passenger on Sea Voyage 1. Nature of Contracts, Art. 695 2. Obligations of Passengers, Arts. 693, 699, 704, 694, 700 3. Rights of Passengers, Arts. 697, 698

Sweet Lines v. CA, 121 SCRA 769 Trans-Asia Shipping v. CA, 254 SCRA 260

J. Carriage of Goods by Sea Act (Commonwealth Act No. 65; Public Act. No. 521, 74th US Congress) Ang v. American Steamship Agencies, 19 SCRA 123 F.H. Stevens v. Nordeutscher, 6 SCRA 180 VI. Air Transportion

A. International Air Transportation (Unless otherwise indicated, reference is to the Warsaw Convension, 51 O.G. 5084; Presidential Proclamation No. 201, 51, O.G. 4933 [Oct. 1995] 1. Constitutionality Santos v. Northwest, 210 SCRA 256 2. When applicable, Art. 1(1) 3. Liabilities under the Convention, Arts. 17, 18, 19 Northwest v. Cuenca, 14 SCRA 1063 Alitalia v. IAC, 192 SCRA 10

4. Limitations on Liability, Art. 22 Pan Am v. IAC, 164 SCRA 268 5. When limitations unavailable, Art 3, 25 TWA v CA, 165 SCRA 143

6. Conditions on Imposition of Liability, Art 26, 28, 29 Santos v. Northwest, supra Luna v. Court of Appeals, 216 SCRA 107 Lhuillier v. British Airways, G.R. No 171092, March 15, 2010 PAL v. Savillo, G.R. No 149547, July 4, 2008 United Airlines v Uy, G.R. No. 127768, November 19, 1999

B. Passenger Rights Joint DOTC-DTI Administrative Order No. 01, Series of 2012