Doctrine of combined or connecting services

Doctrine of combined or connecting services

The doctrine of combined or connecting services holds that the carrier who makes the delivery of the merchandise to the consignee by virtue of combined agreements or services with other carriers shall assume the obligations of those who preceded him in the conveyance.

The carrier who makes the delivery shall likewise acquire all the actions and rights of those who preceded him in the conveyance.

The shipper and the consignee shall have an immediate right of action against any of the following:

• the carrier who executed the transportation contract; or
• against the other carriers who may have received the goods transported without reservation.

But even if a reservation is made by other carriers, the same shall not relieve them from the responsibilities which they may have incurred by their own acts (Art. 373, Code of Commerce).

Application of prescriptive periods under the Civil Code

Application of prescriptive periods under the Civil Code

Considering that no specific periods for the prescription of action were provided for under Article 366 of the Code of Commerce, it is to be presumed that that the Civil Code rules on prescription shall apply. Hence, if, despite the notice of claim filed by the shipper or consignee the carrier still refuses to pay, the former may file the claim in court within the following prescriptive periods:

• Where no bill of lading was issued, within six (6) years; or
• Where a Bill of lading was issued, within ten (10) years.

Shorter period may validly be stipulated by the parties

Shorter period may validly be stipulated by the parties

The validity of a contractual limitation of time for filing the suit itself against a carrier shorter than the statutory period therefor has generally been upheld as such stipulation merely affects the shipper’s remedy and does not affect the liability of the carrier.

In the absence of any statutory limitation and subject only to the requirement on the reasonableness of the stipulated limitation period, the parties to a contract of carriage may fix by agreement a shorter time for the bringing of suit on a claim for the loss of or damage to the shipment than that provided by the statute of limitations. Such limitation is not contrary to public policy for it does not in any way defeat the complete vesture of the right to recover, but merely requires the assertion of that right by action at an earlier period than would be necessary to defeat it through the operation of the ordinary statute of limitations (Philippine American General Insurance Co., Inc. v. Sweet Lines, Inc., GR 87434. Aug. 5, 1992).

Rules on claim do not apply to undelivered goods

Rules on claim do not apply to undelivered goods

The rules enunciated under Article 366 of the Code of Commerce find no application in such cases wherein the goods entrusted to the carrier are not delivered by the carrier to the consignee. In such cases there can be no question of a claim for damages suffered by the goods while in transport, since the claim for damages arises exclusively out of the failure to make delivery (Roldan v. Lim Ponzo & Co., GR L-11325. Dec. 7, 1917).

Patent damage vis-à-vis latent damage

Patent damage vis-à-vis latent damage

A patent damage is defined as a damage on the goods which is readily apparent from the examination of the packages in which the goods are delivered while a latent damage is that damage of such a character that the nature and extent thereof is not readily apparent until the packages are opened and the contents are examined.

24-hour claim a condition precedent to an action against carrier

24-hour claim a condition precedent to an action against carrier

The 24-hour claim requirement as a condition precedent to the accrual of a right of action against a carrier for loss of, or damage to, the goods. The shipper or consignee must allege and prove the fulfillment of the condition. Otherwise, no right of action against the carrier can accrue in favor of the former (Philippine Charter Insurance Corp. v. Chemoil Lighterage Corp., GR 136888. June 29, 2005).

In sum, the rules provide that in case of a patent damage to the goods, the shipper must promptly file an oral or written claim against the carrier upon delivery, whereas, in the event of a latent damage, the shipper should file a claim against the carrier within twenty four (24) hours from delivery.

Rationale for the requisite period of giving notice of claim

Rationale for the requisite period of giving notice of claim

The fundamental reasons or purposes of the requirement to give notice of loss or damage to the goods is not to relieve the carrier from liability but:

• to inform it that the shipment has been damaged and that it is charged with liability therefor; and
• to give it an opportunity to examine the nature and extent of the injury.

This protects the carrier by affording it an opportunity to make an investigation of a claim while the matter is still fresh and easily investigated so as to safeguard itself from false and fraudulent claims (Philippine American General Insurance Co., Inc. v. Sweet Lines, Inc., GR 87434. Aug. 5, 1992, 212 SCRA 194).

When claim for damage may no longer be admitted

When claim for damage may no longer be admitted

No claim shall be admitted against the carrier with regard to the condition in which the goods transported were delivered:

• after the periods mentioned above ( 366, Code of Commerce, par. 1) have elapsed; or
• after the transportation charges have been paid (, par. 2).

Claim for damage, when and how made

Claim for damage, when and how made

The law requires that the claim for damage or average must be made:

• immediately after delivery, if the damage is apparent; or
• within twenty four (24) hours from receipt of the merchandise if damage cannot be ascertained merely from the outside packaging of the cargo ( 366, Id.).

In order that the condition provided in Article 366 of the Code of Commerce may be demanded there should be:

• a consignment of goods, through a common carrier, by a consignor in one place to a consignee in another place; and
• delivery of the merchandise by the carrier to the consignee at the place of destination (New Zealand Insurance Co., Ltd. v. Choa Joy, GR L-7311. Sept. 30, 1955).

Instances when the consignee may refuse to receive the goods

Instances when the consignee may refuse to receive the goods

The consignee may lawfully abandon the goods under the following circumstances:

• Where the undelivered goods form part of the goods transported and the consignee proves that he cannot make use of them independently of the others ( 363, Code of Commerce);
• Where, as a result of the damage to the goods, the same are rendered useless for sale and consumption for the purposes for which they are properly destined ( 365, Id.); and
• When the delay is incurred through the fault of the carrier ( 371, Id.).