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SakayNa, Inc., a corporation engaged in pre-arranged transportation services for a fee using an online-enabled platform, connects passengers with…

2026 Bar Exam · Commercial & Taxation Law · Question 6 · Essay

The question

SakayNa, Inc., a corporation engaged in pre-arranged transportation services for a fee using an online-enabled platform, connects passengers with drivers who use their own vehicles to transport them. Sarah, a passenger, was connected by SakayNa, Inc. to Manny. On the way to their destination, they were involved in an accident, and Sarah suffered serious injuries. Sarah sued SakayNa, Inc. for breach of contract of carriage for being a common carrier. Is SakayNa, Inc. liable for breach of contract of carriage as a common carrier? Explain.

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.

This is general legal information, not legal advice.