G.R. No. 70876 July 19, 1990
MA. LUISA BENEDICTO, petitioner, vs. HON. INTERMEDIATE APPELLATE COURT and GREENHILLS WOOD INDUSTRIES COMPANY, INC., respondents.

FACTS

Private respondent Greenhills Wood Industries contracted to deliver sawn lumber to Blue Star Mahogany, Inc. To effect the initial delivery, Greenhills’ resident manager, Dominador Cruz, engaged the services of a cargo truck registered in the name of petitioner Ma. Luisa Benedicto, the proprietor of Macoven Trucking. The truck was driven by Virgilio Licuden. Cruz supervised the loading of the lumber, issued charge invoices to Licuden, and instructed him to deliver the cargo to Blue Star in Valenzuela, Bulacan. The lumber never arrived at its destination. Greenhills subsequently filed a civil case against Benedicto to recover the value of the lost cargo.
In her defense, Benedicto denied liability, asserting she was a stranger to the contract of carriage. She claimed she had sold the truck to a certain Benjamin Tee prior to the incident, although the vehicle remained registered in her name because the purchase price was not fully paid. She argued that Licuden was Tee’s employee and that no perfected contract of carriage existed with her, as there was no proof of her consent or agreement on freightage.

ISSUE

Whether petitioner Ma. Luisa Benedicto, as the registered owner of the cargo truck, can be held liable as a common carrier for the loss of the goods entrusted to its driver.

RULING

Yes. The Supreme Court affirmed the decisions of the lower courts holding Benedicto liable. The Court ruled that Benedicto, being the registered owner of the vehicle and holding herself out to the public through Macoven Trucking as engaged in the business of transporting goods for hire, is considered a common carrier. The prevailing doctrine makes the registered owner liable for consequences arising from the vehicle’s operation as a matter of public policy, irrespective of any unregistered sale. This liability extends to contracts for the carriage of goods, not being limited solely to cases involving injury to passengers.
The Court rejected Benedicto’s argument that no contract of carriage was perfected. Driver Licuden, entrusted with possession and control of the truck, was clothed with at least implied authority to contract for the carriage of goods on behalf of the registered owner. The absence of a pre-fixed freight rate did not negate the contract, as it was determinable by the carrier’s tariff. As a common carrier, Benedicto was bound to observe extraordinary diligence. The loss of the cargo was proven, and Benedicto failed to demonstrate she exercised such diligence or that the loss was due to a fortuitous event. Her liability to Greenhills was thus properly established, without prejudice to her right to seek reimbursement from her alleged transferee and the driver.