ASIA LIGHTRAGE AND SHIPPING INC VS CA AND PRUDENTIAL GUARAMTEE AND

ASSURANCE INC (2003)

Facts: 3,150 metric tons of Better Western White Wheat (valued USD 423, 192)
was shipped from Portland, Oregon to the consignee General Milling in Manila. The
shipment was insured by Prudential under Marine Cargo Risk.

Now, the carrying vessel arrived in Manila and the cargo was transferred to the
custody of Asia Lightrage who was contacted by the consignee to deliver the cargo
to their warehouse in Pasig City.

900 metric tons was loaded on a barge (evidenced by Lightrage Receipt) for delivery
to Gen Milling but did not reach its destination.

This is what happened:

The transport of said cargo was suspended due to a warning of

an incoming typhoon but Lightrage proceeded to pull the barge to
Engineering Island to seek shelter from the approaching typhoon. The
barge was tied down to other barges while weathering down the
storm. The barge developed a list because of a hole it sustained after
hitting an unseen proturbence underneath the water. Lightrage filed a
Marine Protest and secured the services of Gaspar Salvaging Corp
which refloated the barge. The hole was then patched with clay and
cement.

The barge was then towed to ISLOFF terminal before it headed

to Gen Milling’s wharf. Upon reaching the Sta. Mesa spillway, the
barge again ran aground dut to strong current. To avoid the complete
sinking of the barge, a portion of the goods was transferred to 3 other
barges.

The next day, the towing bits of the barge broke. It sank
completely resulting in the loss of the remaining cargo.
Consignee sent a claim letter to Lightrage and another letter to Prudential for the
value of the lost cargo where the latter indemnified the consignee. Prudential later
on sought th recovery of said amount from the petitioner but to no avail.

Thus this complaint.

RTC ruled in favor of respondent. CA affired the decision of the TC.

Issue: Whether or not petitioner Asia Lightrage is a common carrier

Lightrage contended that they are private carriers and not common carriers. They
have no fixed routine, no terminal and issues no tickets.

The contention holds no water. Art 1732 of the Civil Code defined common carriers
as persons, corporations, firms or associations engaged in the business of carrying
or transporting passengers or both, by land, water or air for compensation offering
their services to the public. Art 1732 make no distinction whether the carrying of
persons or goods is principal or ancillary activity. There is likewise no distinction
whether the activity is done on a regular basis or one offering such service on an
occasional or episodic schedule. Similarly, there is no distinction between a carrier
offering its service to the general public or to a narrow segment of the population.

Here, the principal business of the petitioner is lighterage and drayage. It offers its
barges to the public for the carrying and transporting of goods for compensation.
Hence, they are clearly common carriers. The test in determining a common carrier
is whether the undertaking is part of the business engagement of the carrier which
was held out to the public as occupation. This was admitted by Lighterage offering
its barges to the public despite being a limited clientele for carrying goods by water
for compensation.

Obiter Dictum: Lighterage failed to observe extraordinary diligence on the vigilance

over the goods transported by them hence they should be held liable. Evidence
showed that even before the towing bits of the barge broke, it had previously
sustained damage when it hit a sunken object while docketing at Engineering
Island. It suffered a hole. It refloated but was patched only with clay and cement.
This is only provisional remedy which is clearly not enough to sail the barge safely.
When Lighterage persisted with the voyage, it recklessly exposed the cargo to
further damage. Meeting a typhoon head on falls short of extraordinary diligence.
It was also found out that when the towing bits broke, it was no longer affected by
the typhoon hence the storm is not the proximate cause but human negligence.