02 Servando v.

Philippine Steam Navigation AUTHOR: TIGLAO

[G.R. No. L-36481-2 | 23 October 1982] NOTES: Just in case he asks on the value of the goods:
TOPIC: Common Carriers 1,528 cavans of rice = Php 40,907.50
PONENTE: J. Escolin 44 cartons = Php 1,070.50
CASE LAW/ DOCTRINE:
Common Carriers; Limitation of carrier's liability for loss or damage to goods, valid: Reason.It should be pointed
out, however, that in the bills of lading issued for the cargoes in question, the parties agreed to limit the responsibility of
the carrier for the loss or damage that may be caused to the shipment. x x x We sustain the validity of the above
stipulation; there is nothing therein that is contrary to law, morals or public policy.

Agreement on limitation of liability of carrier, binding upon the parties; Reason; Contracts of adhesion not entirely
prohibited.Appellees would contend that the above stipulation does not bind them because it was printed in fine
letters on the back of the bills of lading; and that they did not sign the same. This argument overlooks the
pronouncement of this Court in Ong Yiu vs. Court of Appeals, where the same issue was resolved in this wise: "While it
may be true that petitioner had not signed the plane ticket, he is nevertheless bound by the provisions thereof. 'Such
provisions have been held to be a part of the contract of carriage, and valid and binding upon the passenger regardless
of the latter's lack of knowledge or assent to the regulation.' It is what is known as a contract of 'adhesion', in regards
which it has been said that contracts of adhesion wherein one party imposes a ready made form of contract on the other,
as the plane ticket in the case at bar, are contracts not entirely prohibited. The one who adheres to the contract is in
reality free to reject it entirely; if he adheres, he gives his consent."
EMERGENCY RECIT
Uy Bico and Servando contracted the services of the carrier (Phil Steam) to deliver from Manila to Negros the cavans
of rice and the cartons. In the bill of lading, there was a stipulation as to the limited liability of the carrier. Upon arrival
of the goods, it was placed in the Customs Warehouse where there was partial delivery of some of the cavans to Uy
Bico. However, the warehouse was razed in fire. Petitioners seek to claim for the value of the products damaged. Court
said that the stipulation on the bill of lading is binding despite non-signature because it is binding regardless to his lack
of knowledge or assent. Negligence cannot be imputed also because it no longer had control of the warehouse after it
has delivered the same.
FACTS:
Uy Bico and Servando loaded on board a vessel owned by Philippine Steam Navigation for carriage from
Manila to Negros Occidental 1,528 cavans of rice and 44 cartons of colored paper, toys and general
merchandise.
The contract of carriage was evidenced by a Bill of Lading.
There was a stipulation that limited the responsibility of the carrier for loss or damage that may be caused to the
shipment:
o Under Clause 14: carrier shall not be responsible for loss or damage to shipments billed owners
risk unless such loss or damage is due to the negligence of the carrier. Nor shall the carrier be
responsible for loss or damage caused by force majeure, dangers or accidents of the sea, war, public
enemies, fire.
Upon the arrival of the vessel at Negros Occidental, the cargoes were discharged in good condition and placed
inside the warehouse of the Bureau of Customs. 907 out of 1,528 cavans of rice were delivered to Uy Bico.
Unfortunately, the warehouse was razed by fire due to unknown cause which destroyed the remaining cargoes.
Due to this incident, Uy Bico and Servando filed a claim for the value of the goods against the carrier.
CFI: Ruled in favor of Uy Bico and Servando. It stated that the delivery of the shipment to the warehouse is
not the delivery contemplated under Art. 1736 of the Civil Code. Since the burning of the warehouse occurred
prior to the actual or constructive delivery of the goods, the loss is chargeable against the vessel.
ISSUE(S): W/N Philippine Steam Navigation should be held liable for the loss of the goods

HELD: No.
RATIO:
Article 1736 of the Civil Code imposes upon common carriers the duty to observe extraordinary diligence from
the moment the goods are unconditionally placed in their possession until the same are delivered, actually or
constructively, by the carrier to the consignee or to the person who has the right to receive them, without
prejudice to the provisions of Article 1738.
It should be pointed out, however, that in the bills of lading issued for the cargoes in question, the parties
agreed to limit the responsibility of the carrier. The stipulation is valid not being contrary to law, morals or
 public policy.
Uy Bico and Servando nonetheless claim that this stipulation does not bind them since it was printed at the
back of the Bill of Lading and that they did not sign the same.
o However, as stated in Ong Yiu v. Court of Appeals, while it may be true that a passenger had not signed
the plane ticket, he is nevertheless bound by the provisions thereof. Such provisions have been held to
be part of the contract of carriage, and valid and binding upon the passenger regardless of the latters
lack of knowledge or assent to the regulation.
Where a fortuitous event is the immediate and proximate cause of the loss, the obligor is exempt from liability
for non-performance. Here, the burning of the customs warehouse was an extraordinary event which happened
independently of the will of the carrier. The latter could not have foreseen the event.
There is nothing in the record that will show that the carrier incurred delay in the performance of its obligation.
It appears that not only did it notify Uy Bico and Servando of the arrival of their shipment, it had also
demanded that the same be withdrawn. In fact, pursuant to such demand, Uy Bico had taken delivery of 907
cavans of rice before the burning of the warehouse.
The carrier or its employees cannot also be charged with negligence. The storage of the goods in the Customs
warehouse pending withdrawal thereof by Uy Bico and Servando was undoubtedly made with their knowledge
and consent. Since the warehouse belonged to and was maintained by the Government, it would be unfair to
impute negligence to the carrier, the latter having no control whatsoever over the same.
DISSENTING/CONCURRING OPINION(S):