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Transportation Defined

Generally Speaking, it has been referred to as the movement of goods or persons from one
place to another, by carrier. As a contract, it is one whereby a person, natural or juridical,
obligates himself to transport persons, goods or both, from one place to another, by land,
water or air, for a price or compensation.

What is an international
Any carriage in which, according to the contract made by the parties, the place of
departure and the place of destination, whether or not there be a break in the carriage or a
transshipment, are situated either:

1. Within the territories of two High Contracting Parties; or

Within the territory of a single High Contracting Party, if there is an agreed stopping
place within a territory subject to the sovereignty, suzerainty, mandate or authority of
another Power, even though that Power is not a party to the Convention. (Art. 1[2])


What is the meaning of

land transportation
It means the owner or owners of motor vehicles for transportation of a passenger for
compensation, including school buses. (Sec. 373, [e])

What is the prior operator


Provides existing franchise operator preferential right within authorized territory as long as
said operator renders satisfactory and economical service. This rule subordinates the prior
applicant rule which gives first applicant priority only if things and circumstances are
equal. A prior operator must be given the opportunity to extend its transportation services
before permitting a new operator to operate in the territory of said prior operator.

What are the exceptions of

prior operator rule?
Where public interest would be better served by the new operator:
1. Where the old operator failed to make an offer to meet the increase in traffic;
2. Where the CPC granted to the new operator s a maiden certificate;

When the application of the rule would be conducive to monopoly.

It is a written acknowledgement of receipt of goods and agreement to transport them to a
specific place and to a named person or to his order.

What is the so-called

boundary system?
Under this system the driver is engaged to drive the owner/operators unit and pays the
latter a fee commonly called boundary for the use of the unit. Whatever he earned in
excess of that amount is his income. (Paguio Transport Corp. v. NLRC, G.R. No.
119500, Aug. 28, 1998)

What kind of relationship exists

between the owner of the
vehicle and the driver under a
"boundary system"
The relationship between jeepney owners/operators on one hand and jeepney drivers on
the other under the boundary system is that of employer-employee and not of lessorlessee. (Martinez v. NLRC, G.R. No. 117495, May 29, 1997).

The features which characterize, the "boundary system" namely, the fact that the driver
does not receive a fixed wage but gets only the excess of the amount 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 the employer and employee. (National Labor Union v.
Dinglasan, G.R. No. L-14183, Nov. 4, 1993)

When Warsaw Convention

this law applicable?
This Convention applies to all international carriage of persons, luggage or goods
performed by aircraft for reward. It applies equally to gratuitous carriage by aircraft
performed by an air transport undertaking. (Art. 1[1])

Common Carriers
Common Carriers are persons, corporations, firms or associations engaged in the business
of carrying or transporting passengers or goods or both, by land water air, for
compensation, offering their service to the public.

Elements of a common carrier:

a. persons' corporations, firms or associations
b. engaged in the businessof carrying or transportingpassengers, goods or both
c. means of carriage is by land, water or air
d. the carrying of passengers , goods or both is for compensation
e. the service is offered to the public without distinction.

-Engaged in the business is deemed to cover operations whether regular or scheduled,

occasional, episodic or unscheduled.
- One is a common carrier even if he has no fixed and publicly known route, maintains no
terminals and issues no ticket.
- The true test of whether the character of the use is whether the public may enjoy it by
right or by permission. Note that the contract of transportation is a consensual contract.
Hence, a common carrier engages in a continuous offer. If you flag a common carrier
down, the contract becomes perfected and is consistent with the idea that entering with a
contract with the common carrier is a matter of right and not permission. You would know
when the carrier you are going to flag down is a common carrier because it should hold
itself out principally as such.
- Recovery from a contract of private carriage, requires a contract, that there was
negligence, and that the goods are lost. On the other hand, recovery from a contract with
a common carrier, only requires the contract and that the goods were lost. This is so
because of the presumption of negligence.
- Regardless of whether the object are goods or passengers,a common carrier mus
observe extra-ordinary diligence.
- If loss, destruction or deterioration of the goods occurs or death or physical injuries is
suffered by a passenger, there is a presumption of negligence that arises. The
presumption may only be overcome by a showing that the required degree of diligence has
been observed or that Article 1735 applies in the case of goods. In case of passengers,
only the former.
- The following or similar stipulations shall be considered unreasonable, unjust and
contrary to public policy:
a. that the common carrier shall not be responsible for the acts or omissions of its or his
b. that the common carrier's liability for acts committed by thieves, or of robbers who do
not act with grave or irresistible threat, violence or force, is dispensed with or diminished.
c. that the common carrier is not responsible for the loss, destruction, or deterioration of
goods on account of the defective condition of the car, vehicle, ship, airplane or other
equipment used in the contract of carriage.