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Transportation and Public Utilities Law JD-3

Code of Commerce Provisions on Overland d. Contract of Carriage


Transportation
Bill of lading - A bill of lading may be defined as a
a. Scope of Overland Transportation written acknowledgment of the receipt of goods and
b. Nature of Contract an agreement to transport and to deliver them at a
specified place to a person named or on his order. It
Q: When is a contract of transportation by land or comprehends all methods of transportation.
water ways considered commercial?
Nature:
A:
1. Each bill is a contract in itself and the parties are
Article 349. A contract of transportation by land bound by its terms.
or water ways of any kind shall be considered 2. A bill of lading is also a receipt.
commercial: 3. It is also a symbol of the goods covered by it.
4. A bill of lading is also a document of title.
1. When it has for its object merchandise
or any article of commerce. o A document of title is any document used
2. When, whatever its object may be, the in the ordinary course of business in the
carrier is a merchant or is habitually sale or transfer of goods, as proof of the
engaged in transportation for the public. possession or control of goods, or
authorizing or purporting to authorize the
possessor of the document to transfer or
c. Effect of Civil Code receive, either by indorsement or by
delivery, goods represented by such
Article 1766. In all matters not regulated by this document
Code, the rights and obligations of common
carriers shall be governed by the Code of i. Definition, Subject matter
Commerce and by special laws.
Article 352. The bills of lading, or tickets in cases
Article 2270. The following laws and regulations of transportation of passengers, may be diverse,
are hereby repealed: some for persons and others for baggage; but all
of them shall bear the name of the carrier, the
date of shipment, the points of departure and
1. Those parts and provisions of the Civil
arrival, the cost, and, with respect to the
Code of 1889 which are in force on the
baggage, the number and weight of the packages,
date when this new Civil Code becomes
with such other manifestations which may be
effective:
considered necessary for their easy identification.
2. The provisions of the Code of Commerce
governing sales, partnership, agency,
loan, deposit and guaranty; Q: What should a bill of lading contain?
3. The provisions of the Code of Civil
Procedure on prescription as far as A:
inconsistent with this Code; and 1. Name of the carrier
4. All laws, Acts, parts of Acts, rules of 2. Date of shipment
court, executive orders, and 3. Points of departure and arrival
administrative regulations which are 4. Cost
inconsistent with this Code. (n) 5. With respect to packages: The number and
weight of the packages with such
manifestations for easy identification

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ii. Form, Contents 3. The schedules and regulations the


application of which he requests
Article 350. The shipper as well as the carrier of
merchandise or goods may mutually demand that Q: What if the shipper does not determine the
a bill of lading be made, stating: schedule?

1. The name, surname and residence of the A: The carrier must apply the rate of those which
shipper. appear to be the lowest, with the conditions
2. The name, surname and residence of the inherent thereto, always including a statement or
carrier. reference to in the bill of lading which he delivers to
3. The name, surname and residence of the the shipper.
person to whom or to whose order the
goods are to be sent or whether they are
to be delivered to the bearer of said bill. Function
4. The description of the goods, with a
statement of their kind, of their weight, Article 353. The legal evidence of the contract
and of the external marks or signs of the between the shipper and the carrier shall be the
packages in which they are contained. bills of lading, by the contents of which the
5. The cost of transportation. disputes which may arise regarding their
6. The date on which shipment is made. execution and performance shall be decided, no
7. The place of delivery to the carrier. exceptions being admissible other than those of
8. The place and the time at which delivery falsity and material error in the drafting.
to the consignee shall be made.
9. The indemnity to be paid by the carrier After the contract has been complied with, the
in case of delay, if there should be any bill of lading which the carrier has issued shall be
agreement on this matter. returned to him, and by virtue of the exchange of
this title with the thing transported, the
Article 351. In transportation made by railroads respective obligations and actions shall be
or other enterprises subject to regulation rate considered cancelled, unless in the same act the
and time schedules, it shall be sufficient for the claim which the parties may wish to reserve be
bills of lading or the declaration of shipment reduced to writing, with the exception of that
furnished by the shipper to refer, with respect to provided for in Article 366. In case the consignee,
the cost, time and special conditions of the upon receiving the goods, cannot return the bill
carriage, to the schedules and regulations the of lading subscribed by the carrier, because of its
application of which he requests; and if the loss or of any other cause, he must give the latter
shipper does not determine the schedule, the a receipt for the goods delivered, this receipt
carrier must apply the rate of those which appear producing the same effects as the return of the
to be the lowest, with the conditions inherent bill of lading.
thereto, always including a statement or
reference to in the bill of lading which he delivers Q: What is the function of a bill of lading?
to the shipper.
A: It is the legal evidence of the contract between
Transportation made by railroads or other the shipper and the carrier.
enterprises subject to regulation rate and time
schedules Q: Assuming the contract has been complied with,
what now should be done to the bill of lading?
The bills of lading or the declaration of shipment
furnished by the SHIPPER in order to be sufficient A: The bill of lading which the carrier has issued shall
must refer to: be returned to him.

1. The cost Q: What is the effect when returned?


2. Time and special conditions of the carriage

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A: By virtue of the exchange of this title with the consignee who has to be cited does not attend,
thing transported, the respective obligations and the examination shall be made before a notary,
actions shall be considered cancelled, unless in the who shall prepare a memorandum of the result of
same act the claim which the parties may wish to the investigation, for such purposes as may be
reserve be reduced to writing, with the exception of proper.
that provided for in Article 366.
If the declaration of the shipper should be true,
Q: What if the consignee, upon receiving the goods, the expense occasioned by the examination and
cannot return the bill of lading subscribed by the that of carefully repacking the packages shall be
carrier, because of its loss or of any other cause? for the account of the carrier and in a contrary
case for the account of the shipper.
A: He must give the latter a receipt for the goods
delivered, this receipt producing the same effects as
the return of the bill of lading. Q: If by reason of well-founded suspicion of falsity in
the declaration as to the contents of a package the
carrier should decide to examine it, how shall the
carrier proceed with his investigation?
Refusal to transport
A: He shall proceed with his investigation in the
Article 356. Carriers may refuse packages which presence of witnesses, with the shipper or consignee
appear unfit for transportation; and if the in attendance.
carriage is to be made by railway, and the
shipment is insisted upon, the company shall Q: How about if the shipper or consignee who has to
transport them, being exempt from all be cited does not attend?
responsibility if its objections, is made to appear
in the bill of lading. A: The examination shall be made before a notary,
who shall prepare a memorandum of the result of
Q: Can the carrier refuse packages which are unfit the investigation, for such purposes as may be
for transportation? proper.

A: Yes No Bill of Lading

Q: What if the carriage is to be made by railway, and Article 354. In the absence of a bill of lading,
the shipment is insisted upon? disputes shall be determined by the legal proofs
which the parties may present in support of their
A: The company shall transport them, being exempt respective claims, according to the general
from all responsibility. provisions established in this Code for
commercial contracts.
Q: In the previous question, how will the carrier be
exempt from liability? Q: In the absence of a bill of lading, how shall
disputes be determined?
A: Its objections, should appear in the bill of lading
to exempt the carrier from liability. A: It shall be determined by the legal proofs which
the parties may present in support of their
respective claims, according to the general
Doubtful declaration of contents provisions established in this Code for commercial
contracts.
Article 357. If by reason of well-founded
suspicion of falsity in the declaration as to the
contents of a package the carrier should decide to
examine it, he shall proceed with his investigation
in the presence of witnesses, with the shipper or
consignee in attendance. If the shipper or

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e. Responsibility of the Carrier Q: What if on account of said cause of force


majeure, the carrier had to take another route which
i. When it commences produced an increase in transportation charges, is he
entitled to reimbursement?
Article 355. The responsibility of the carrier shall
commence from the moment he receives the A: Yes, he shall be reimbursed for such increase
merchandise, personally or through a person upon formal proof thereof.
charged for the purpose, at the place indicated
for receiving them.
iii. Care of goods
Q: When does the responsibility of the carrier
commences? Article 361. The merchandise shall be transported
at the risk and venture of the shipper, if the
A: It commence from the moment he receives the contrary has not been expressly stipulated.
merchandise, personally or through a person
charged for the purpose, at the place indicated for As a consequence, all the losses and
receiving them. deteriorations which the goods may suffer during
the transportation by reason of fortuitous event,
ii. Route force majeure, or the inherent nature and defect
of the goods, shall be for the account and risk of
Article 359. If there is an agreement between the the shipper. Proof of these accidents is
shipper and the carrier as to the road over which incumbent upon the carrier.
the conveyance is to be made, the carrier may
not change the route, unless it be by reason of Q: Who bears the loss of the merchandise if there is
force majeure; and should he do so without this no stipulation?
cause, he shall be liable for all the losses which
the goods he transports may suffer from any A: The merchandise shall be transported at the risk
other cause, beside paying the sum which may and venture of the shipper. As a consequence, all the
have been stipulated for such case. losses and deteriorations which the goods may
suffer during the transportation by reason of
When on account of said cause of force majeure, fortuitous event, force majeure, or the inherent
the carrier had to take another route which nature and defect of the goods, shall be for the
produced an increase in transportation charges, account and risk of the shipper.
he shall be reimbursed for such increase upon
formal proof thereof. Q: Proof of these accidents is incumbent upon
whom?
Q: If there is an agreement between the shipper and
the carrier as to the road over which the conveyance A: The carrier
is to be made, can the carrier change the route?
Article 362. Nevertheless, the carrier shall be
A: As a general rule no, except by reason of force liable for the losses and damages resulting from
majeure. the causes mentioned in the preceding article if it
is proved, as against him, that they arose through
Q: What is the effect if the carrier should do so his negligence or by reason of his having failed to
without this cause (Force majeure)? take the precautions which usage has established
among careful persons, unless the shipper has
A: He shall be liable for all the losses which the committed fraud in the bill of lading, representing
goods he transports may suffer from any other the goods to be of a kind or quality different from
cause, besides paying the sum which may have been what they really were.
stipulated for such case.

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If, notwithstanding the precautions referred to in 5. Order or act of competent public


this article, the goods transported run the risk of authority.
being lost, on account of their nature or by
reason of unavoidable accident, there being no
time for their owners to dispose of them, the Q: Under the civil code are common carriers
carrier may proceed to sell them, placing them responsible for the loss, destruction, or deterioration
for this purpose at the disposal of the judicial of the goods?
authority or of the officials designated by special
provisions. A: Generally: Yes,

Except: The same is due to any of the following


causes only:
Q: What are the instances when the carrier is liable
for the losses and damages resulting from the causes
mentioned in the preceding article? 1. Flood, storm, earthquake, lightning, or
other natural disaster or calamity;
A: Generally, the carrier shall be liable if they arose 2. Act of the public enemy in war, whether
through his negligence or by reason of his having international or civil;
failed to take the precautions which usage has 3. Act of omission of the shipper or owner of
established among careful persons. the goods;
4. The character of the goods or defects in the
Except: The shipper has committed fraud in the bill packing or in the containers;
of lading, representing the goods to be of a kind or 5. Order or act of competent public authority.
quality different from what they really were.
Article of the Civil Code 1735. In all cases other
Q: If notwithstanding the precautions referred to in than those mentioned in Nos. 1, 2, 3, 4, and 5 of
this article, the goods transported run the risk of the preceding article, if the goods are lost,
being lost, on account of their nature or by reason of destroyed or deteriorated, common carriers are
unavoidable accident, there being no time for their presumed to have been at fault or to have acted
owners to dispose of them, What may the carrier negligently, unless they prove that they observed
do? extraordinary diligence as required in Article
1733.
A: The carrier may proceed to sell them, placing
them for this purpose at the disposal of the judicial Q: If other than those mentioned in Nos. 1, 2, 3, 4,
authority or of the officials designated by special and 5 of the preceding article, and the goods are
provisions. lost, destroyed or deteriorated, who is presumed at
fault of have acted negligently?
Article 1734 of the Civil Code. Common carriers
A: Common carriers are presumed to have been at
are responsible for the loss, destruction, or
fault or to have acted negligently, unless they prove
deterioration of the goods, unless the same is due
that they observed extraordinary diligence.
to any of the following causes only:
iv. Delivery
1. Flood, storm, earthquake, lightning, or
other natural disaster or calamity; Condition of goods
2. Act of the public enemy in war, whether
international or civil;
Article 363. Outside of the cases mentioned in
3. Act of omission of the shipper or owner
the second paragraph of Article 361, the carrier
of the goods;
shall be obliged to deliver the goods shipped in
4. The character of the goods or defects in
the same condition in which, according to the bill
the packing or in the containers;
of lading, they were found at the time they were
received, without any damage or impairment,
and failing to do so, to pay the value which those

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not delivered may have at the point and at the properly destined, the consignee shall not be
time at which their delivery should have been bound to receive them, and he may have them in
made. the hands of the carrier, demanding of the latter
their value at the current price on that day.
If those not delivered form part of the goods
transported, the consignee may refuse to receive If among the damaged goods there should be
the latter, when he proves that he cannot make some pieces in good condition and without any
use of them independently of the others. defect, the foregoing provision shall be applicable
with respect to those damaged and the consignee
Q: Outside of the cases mentioned in the second shall receive those which are sound, this
paragraph of Article 361, (fortuitous event, force segregation to be made by distinct and separate
majeure, or the inherent nature and defect of the pieces and without dividing a single object, unless
goods) what is the obligation of the carrier? the consignee proves the impossibility of
conveniently making use of them in this form.
A: The carrier shall be obliged to deliver the goods
shipped in the same condition in which, according to The same rule shall be applied to merchandise in
the bill of lading, they were found at the time they bales or packages, separating those parcels which
were received, without any damage or impairment. appear sound.
Q: What if the carrier failed to deliver the goods
shipped in the same condition in which, according to Q: If, in consequence of the damage, the goods are
the bill of lading? rendered useless for sale and consumption for the
purposes for which they are properly destined, is the
A: The carrier shall pay the value which those not consignee shall be bound to receive them?
delivered may have at the point and at the time at
which their delivery should have been made. A: The consignee shall not be bound to receive
them, and he may have them in the hands of the
Q: If those not delivered form part of the goods carrier, demanding of the latter their value at the
transported, may the consignee may refuse to current price on that day.
receive the latter?

A: Yes, when he proves that he cannot make use of Q: If among the damaged goods there should be
them independently of the others. some pieces in good condition and without any
defect?

Article 364. If the effect of the damage referred A: The foregoing provision shall be applicable with
to in Article 361 is merely a diminution in the respect to those damaged and the consignee shall
value of the goods, the obligation of the carrier receive those which are sound.
shall be reduced to the payment of the amount
which, in the judgment of experts, constitutes This segregation to be made by distinct and separate
such difference in value pieces and without dividing a single object, unless
the consignee proves the impossibility of
Q: If the effect of the damage referred to in Article conveniently making use of them in this form.
361 (fortuitous event, force majeure, or the inherent
nature and defect of the goods) is merely a The same rule shall be applied to merchandise in
diminution in the value of the goods? bales or packages, separating those parcels which
appear sound.
A: The obligation of the carrier shall be reduced to
the payment of the amount which, in the judgment Article 366. Within the twenty-four hours
of experts, constitutes such difference in value. following the receipt of the merchandise, the
claim against the carrier for damage or average
Article 365. If, in consequence of the damage, the be found therein upon opening the packages,
goods are rendered useless for sale and may be made, provided that the indications of
consumption for the purposes for which they are the damage or average which gives rise to the

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claim cannot be ascertained from the outside part In case of disagreement, by a third one appointed by
of such packages, in which case the claim shall be the judicial authority, the results to be reduced to
admitted only at the time of receipt. writing.

After the periods mentioned have elapsed, or the Q: What if the interested parties should not agree
transportation charges have been paid, no claim with the expert opinion and they do not settle their
shall be admitted against the carrier with regard differences?
to the condition in which the goods transported
were delivered. A: The merchandise shall be deposited in a safe
warehouse by order of the judicial authority, and
they shall exercise their rights in the manner that
Q: Within what period may the claims of the carrier may be proper.
be brought?

A: Within the twenty-four hours following the To whom delivery made


receipt of the merchandise provided that the
indications of the damage or average which gives Article 368. The carrier must deliver to the
rise to the claim cannot be ascertained from the consignee, without any delay or obstruction, the
outside part of such packages, in which case the goods which he may have received, by the mere
claim shall be admitted only at the time of receipt. fact of being named in the bill of lading to receive
them; and if he does not do so, he shall be liable
Q: What happens after the periods mentioned have for the damages which may be caused thereby.
elapsed, or the transportation charges have been
paid? Q: To whom must the carrier deliver the goods?

A: No claim shall be admitted against the carrier with A: The carrier must deliver to the consignee, without
regard to the condition in which the goods any delay or obstruction, the goods which he may
transported were delivered. have received, by the mere fact of being named in
the bill of lading to receive them.
Article 367. If doubts and disputes should arise
between the consignee and the carrier with Q: What is the effect if he does not do so?
respect to the condition of the goods transported
at the time their delivery to the former is made, A: He shall be liable for the damages which may be
the goods shall be examined by experts caused thereby.
appointed by the parties, and, in case of
disagreement, by a third one appointed by the When to be made
judicial authority, the results to be reduced to
writing; and if the interested parties should not Article 358. If there is no period fixed for the
agree with the expert opinion and they do not delivery of the goods the carrier shall be bound to
settle their differences, the merchandise shall be forward them in the first shipment of the same or
deposited in a safe warehouse by order of the similar goods which he may make point where he
judicial authority, and they shall exercise their must deliver them; and should he not do so, the
rights in the manner that may be proper. damages caused by the delay should be for his
account.
Q: What will happen if there are doubts and disputes
that should arise between the consignee and the
Article 370. If a period has been fixed for the
carrier with respect to the condition of the goods
delivery of the goods, it must be made within
transported at the time their delivery to the former
such time, and, for failure to do so, the carrier
is made?
shall pay the indemnity stipulated in the bill of
lading, neither the shipper nor the consignee
A: The goods shall be examined by experts
being entitled to anything else. If no indemnity
appointed by the parties.

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has been stipulated and the delay exceeds the


time fixed in the bill of lading, the carrier
shall be liable for the damages which the delay
may have caused.

Q: If there is no period fixed for the delivery of the


goods?

A: The carrier shall be bound to forward them in the


first shipment of the same or similar goods which he
may make point where he must deliver them.

Q: What is the effect if he does not do so?

A: The damages caused by the delay should be for


his account.

Q: If a period has been fixed for the delivery of the


goods?

A: It must be made within such time.

Q: What is the effect if he does not do so?

A: The carrier shall pay the indemnity stipulated in


the bill of lading, neither the shipper nor the
consignee being entitled to anything else. If no
indemnity has been stipulated and the delay exceeds
the time fixed in the bill of lading, the carrier shall be
liable for the damages which the delay may have
caused.

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