G.R. No. L-48757 May 30, 1988
MAURO GANZON, petitioner, vs. COURT OF APPEALS and GELACIO E. TUMAMBING, respondents.

FACTS

Petitioner Mauro Ganzon, a common carrier, contracted with private respondent Gelacio Tumambing to haul 305 tons of scrap iron from Mariveles, Bataan, to Manila using the lighter LCT “Batman.” On December 1, 1956, Tumambing delivered the scrap iron to Ganzon’s captain, Filomeno Niza, for loading. Loading commenced immediately. During the process, Mariveles Mayor Jose Advincula arrived, demanded money from Tumambing, and shot him when he refused, necessitating Tumambing’s hospitalization. Loading later resumed.
On December 4, 1956, Acting Mayor Basilio Rub, with policemen, ordered Captain Niza and his crew to dump the already-loaded scrap iron into the sea. The remaining scrap was taken to a government compound, and the municipality issued a receipt for the seized cargo. Tumambing subsequently filed an action for damages based on culpa contractual against Ganzon for the loss of the scrap iron.

ISSUE

The primary issue is whether Ganzon, as a common carrier, is liable for the loss of the cargo despite the intervention and orders of local public officials, or whether such intervention constitutes a fortuitous event exempting him from liability.

RULING

The Supreme Court affirmed the Court of Appeals’ decision holding Ganzon liable. The contract of carriage was perfected upon the delivery and unconditional receipt of the scrap iron by the carrier’s captain, thereby commencing the carrier’s extraordinary responsibility under Article 1736 of the Civil Code. This responsibility attaches from the moment the goods are placed in the carrier’s custody and control, regardless of whether they are fully loaded.
The Court rejected Ganzon’s defense of fortuitous event under Article 1174. For an event to be considered fortuitous, it must be an occurrence that is impossible to foresee or, if foreseeable, impossible to avoid. The acts of the municipal officials, while a direct cause, did not constitute a legal caso fortuito that would exempt the carrier. The carrier failed to prove that the loss was due to an “order or act of competent public authority” as an exempting cause under Article 1734(5). The Court found no evidence that the officials acted with lawful authority or due process in seizing and destroying the cargo; their actions appeared arbitrary. Furthermore, Ganzon failed to demonstrate that he exercised the extraordinary diligence required of common carriers to prevent the loss or that the event was entirely unforeseeable and unavoidable. The presumption of fault under Article 1735 thus remained unrebutted, making Ganzon liable for breach of contract. The Court awarded actual and exemplary damages, plus attorney’s fees.