Held
SakayNa, Inc. is liable as a common carrier for breach of contract of carriage, under Article 1732 of the Civil Code.
Explanation
Article 1732 defines a common carrier as one who carries passengers or goods for compensation and offers services to the public. The law does not require that the services be offered on a regular schedule or to the entire general public; even offering services to a narrow segment or on an occasional basis qualifies as being a common carrier. SakayNa, Inc., by connecting passengers and drivers through an online platform for pre-arranged transportation services for a fee, fits this definition because it offers transportation services to the public via its app.
Common carriers are held to a high standard of care, called extraordinary diligence, to ensure passenger safety (Articles 1733 and 1755). If passengers are injured, the law presumes the carrier's fault or negligence unless the carrier proves it exercised extraordinary diligence (Article 1756). Furthermore, carriers are liable for injuries caused by their employees' negligence or willful acts, even if those acts exceed the employees' authority (Article 1759).
The Supreme Court in LTFRB v. Valenzuela clarified that transportation network companies (TNCs) like SakayNa, Inc. are common carriers because their services, when drivers log in to the platform, are available for public consumption. The Court emphasized that the contractual relationship is not purely private since the app automatically pairs drivers and passengers, limiting discretion and making the service public in nature.
Application to the facts
SakayNa, Inc. operates as a transportation network company that connects passengers like Sarah with drivers using their own vehicles for a fee. By doing so, it offers transportation services to the public through its online platform, satisfying the definition of a common carrier under Article 1732 of the Civil Code. The fact that the service is pre-arranged and facilitated by an app does not exclude SakayNa, Inc. from being a common carrier, as the Supreme Court has ruled that such companies are common carriers regardless of whether the service is regular or occasional, or offered to a narrow segment of the public.
Since Sarah was injured during the trip, SakayNa, Inc. is presumed negligent under Article 1756 unless it can prove it exercised extraordinary diligence as required by Articles 1733 and 1755. The liability extends to injuries caused by the negligence of the driver, who acts as an employee or agent of SakayNa, Inc., under Article 1759. Therefore, SakayNa, Inc. is liable for breach of contract of carriage as a common carrier for Sarah's injuries unless it proves it exercised extraordinary diligence.
"Common carriers are persons, corporations, firms or associations engaged in the business of carrying or transporting passengers or goods or both, by land, water, or air, for compensation, offering their services to the public."
"Common carriers, from the nature of their business and for reasons of public policy, are bound to observe extraordinary diligence in the vigilance over the goods and for the safety of the passengers transported by them, according to all the circumstances of each case."
"A common carrier is bound to carry the passengers safely as far as human care and foresight can provide, using the utmost diligence of very cautious persons, with a due regard for all the circumstances."
"In case of death of or injuries to passengers, common carriers are presumed to have been at fault or to have acted negligently, unless they prove that they observed extraordinary diligence as prescribed in articles 1733 and 1755."
"Common carriers are liable for the death of or injuries to passengers through the negligence or wilful acts of the former's employees, although such employees may have acted beyond the scope of their authority or in violation of the orders of the common carriers."
Laws retrieved
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- Article 1732, Obligations and Contracts and Related Laws
- Article 1733, Obligations and Contracts and Related Laws
- Article 1755, Obligations and Contracts and Related Laws
- Article 1756, Obligations and Contracts and Related Laws
- Article 1759, Obligations and Contracts and Related Laws
"Article 1732 of the Civil Code does not distinguish between a carrier who offers its services to the general public and one who offers services or solicits business only from a narrow segment of the general population... Article 1732 also carefully avoids making any distinction between a person or enterprise offering transportation service on a regular or scheduled basis and one offering such service on an occasional, episodic or unscheduled basis... when they put themselves online, their services are bound for indiscriminate public consumption."
Cases retrieved
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