transpo case

7/25/2019 Transpo Case

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G.R. No. L-6393 January 31, 1955A. MAGSAYSAY INC., plaintif-appll,

!".ANAS#ACI$ AGAN, %&n%ant-appllant.

REYES,A. J.:

The S S "San Antonio", vessel owned and operated by plaintif, let

Manila on October 6, !!, bo#nd or $asco, $atanes, vis %parri,

&a'ayan, with 'eneral car'o belon'in' to diferent shippers,

a(on' the( the deendant) The vessel reached %parri on the

*th o that (onth, and ater a day+s stopover in that port,

wei'hed anchor to proceed to $asco) $#t while still in port, it ran

a'ro#nd at the (o#th o the &a'ayan river, and, atte(pts toreoat it #nder its own power havin' ailed, plaintif have it

reoated by the -#.on Stevedorin' &o) at an a'reed

co(pensation) Once aoat the vessel ret#rned to Manila to re#el

and then proceeded to $asco, the port o destination) There the

car'oes were delivered to their respective owners or consi'nees,

who, with the e/ception o deendant, (ade a deposit or si'ned a

bond to answer or their contrib#tion to the avera'e)

On the theory that the e/penses inc#rred in oatin' the vessel

constit#te 'eneral avera'e to which both ship and car'o sho#ld

contrib#te, plaintif bro#'ht the present action in the &o#rt o 0irst

1nstance o Manila to (a2e deendant pay his contrib#tion, which,

as deter(ined by the avera'e ad3#ster, a(o#nts to 45)*)

eendant, in his answer, denies liability to his a(o#nt, alle'in',

a(on' other thin's, that the strandin' o the vessel was d#e to

the a#lt, ne'li'ence and lac2 o s2ill o its (aster, that the

e/penses inc#rred in p#ttin' it aoat did not constit#te 'eneralavera'e, and that the li7#idation o the avera'e was not (ade in

accordance with law) %ter trial, the lower co#rt o#nd or plaintif

and rendered 3#d'(ent a'ainst the deendant or the a(o#nt o

the clai(, with le'al interests) 0ro( this 3#d'(ent deendant had

appealed directly to this &o#rt)


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%ltho#'h appellant assi'ns vario#s errors, #nder o#r view o the

case only the ollowin' need be considered:

The trial co#rt erred in allowin' the 'eneral avera'e or oatin' a

vessel #nintentionally stranded inside a port and at the (o#th oa river d#rin' a 8ne weather)

0or the p#rposes o this assi'n(ent o error we (ay well accept

the 8ndin' below that the strandin' o plaintif+s vessel was d#e

to the s#dden shitin' o the sandbars at the (o#th o the river

which the port pilot did not anticipate) The standin' (ay,

thereore, be re'arded as accidental, and the 7#estion is whether

the e/penses inc#rred in oatin' a vessel so stranded sho#ld be

considered 'eneral avera'e and shared by the car'o owners)

The law on avera'es is contained in the &ode o &o((erce)

9nder that law, avera'es are classi8ed into si(ple or partic#lar

and 'eneral or 'ross) enerally spea2in', si(ple or partic#lar

avera'es incl#de all e/penses and da(a'es ca#sed to the vessel

or car'o which have not in#red to the co((on bene8t ;%rt) 5*!


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sho#ld thereore be classi8ed as partic#lar avera'e, the said

e/penses do not 8t into any o the speci8c cases o 'eneral

avera'e en#(erated in article 5) Ao) 6 o this article does

(ention "e/penses ca#sed in order to oat a vessel," b#t it

speci8cally reers to "a vessel intentionally stranded or thep#rpose o savin' it" and wo#ld have no application where, as in

the present case, the strandin' was not intentional)

-et #s now see whether the e/penses here in 7#estion co#ld

co(e within the le'al concept o the 'eneral avera'e) Tolentino,

in his co((entaries on the &ode o &o((erce, 'ives the

ollowin' re7#isites or 'eneral avera'e:

0irst, there (#st be a co((on dan'er) This (eans, that both theship and the car'o, ater has been loaded, are s#b3ect to the

sa(e dan'er, whether d#rin' the voya'e, or in the port o loadin'

or #nloadin'= that the dan'er arises ro( the accidents o the sea,

dispositions o the a#thority, or a#lts o (en, provided that the

circ#(stances prod#cin' the peril sho#ld be ascertained and

i((inent or (ay rationally be said to be certain and i((inent)

This last re7#ire(ent e/cl#de (eas#res #nderta2en a'ainst a

distant peril)

Second, that or the co((on saety part o the vessel or o the

car'o or both is sacri8ced deliberately)

Third, that ro( the e/penses or da(a'es ca#sed ollows the

s#ccess#l savin' o the vessel and car'o)

0o#rth, that the e/penses or da(a'es sho#ld have been inc#rred

or inicted ater ta2in' proper le'al steps and a#thority) ;Bol) ,

Cth ed), p) DD) bo/es, crates, and parcels, all o which were to

be delivered to the order o the consi'nor at Bladivostoc2, R#ssia)

The rei'ht char'es were then and there prepaid to the #lti(ate

destination)

The bill o ladin' which was iss#ed to the plaintif at $alti(ore

provided, a(on' other thin's, that the 'oods sho#ld be

orwarded by the deendant co(pany ro( Ha(b#r' to

Bladivostoc2 at the ship+s e/pense b#t at the ris2 o the owner o

the 'oods) 1t was also provided that 'oods th#s destined or

points beyond Ha(b#r' sho#ld be s#b3ect to the ter(s e/pressed

in the c#sto(ary or( o bill o ladin' in #se at the ti(e o

ship(ent by the carrier co(pletin' the transit)

hen the ship(ent arrived at Ha(b#r' the carrier co(pany

transerred the car'o to the Suevia, a ship o its own line, andiss#ed to itsel thereor, as orwardin' a'ent, another bill o ladin'

in the c#sto(ary or( then in #se in the port o Ha(b#r',

coverin' the transportation ro( Ha(b#r' to Bladivostoc2)

hile the ship carryin' said car'o was in the &hina Sea en ro#te

to Bladivostoc2 war bro2e o#t in E#rope= and as the Sueviawas a

er(an vessel, the (aster considered it necessary to ta2e re#'e

in the nearest ne#tral port, which happened to be Manila)

%ccordin'ly he p#t into this harbor on %#'#st 6, !, and at thedate o the trial in the co#rt below the ship still re(ained in

re#'e in this port)

%ter it beca(e apparent that the Sueviawo#ld be detained

inde8nitely in the port o Manila, the plaintif co(pany, as owner


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o the car'o above described, in Ian#ary, !D, (ade de(and

#pon the a'ent o the deendant co(pany in Manila to the efect

that it sho#ld orward the car'o to Bladivostoc2, i not by the

Sueviathen by so(e other stea(er) This the deendant co(pany

re#sed to do e/cept #pon the condition that the plaintif wo#lda'ree to s#b3ect said car'o to liability #pon 'eneral avera'e to

satisy the costs and e/penses o the Sueviaincident to its stay in

the port o Manila) To this condition the plaintif did not assent and

on the contrary there#pon de(anded the i((ediate delivery o

the car'o to it in Manila) The deendant co(pany replied with an

ofer to deliver the car'o provided the owner wo#ld deposit with

the deendant co(pany a s#( o (oney e7#ivalent to >* per cent

o the val#e o said car'o, as sec#rity or the aoresaid costs ande/penses to be ad3#sted as 'eneral avera'e) 1n this connection it

(ay be stated that the costs and e/penses inc#rred by the

Sueviaro( the date the ship entered the port o Manila #ntil

March G*, !D, a(o#nted to the s#( o 46G,*>)D*, which

incl#ded port char'es, repairs, and wa'es and (aintenance o

oJcers and crew)

Havin' th#s ar ailed in its eforts to obtain possession o its

property, the plaintif co(pany instit#ted the present action in the

&o#rt o 0irst 1nstance o the city o Manila #pon 0ebr#ary G,

!D) The p#rpose o the proceedin' is to recover the possession

o the car'o, to'ether with da(a'es or breach o contract and

#nlaw#l detention o the property) %t the ti(e the action was

instit#ted, or soon thereater, the plaintif obtained the delivery o

the property ro( the Sueviaby (eans o a writ o replevin and

orwarded it to Bladivostoc2 by another stea(er) 1n its answer the

deendant co(pany denies liability or da(a'es and asserts thatit has a lien on the property or 'eneral avera'e, as already

indicated) 1n the co#rt below 3#d'(ent was 'iven in avor o the

plaintif, reco'ni.in' its ri'ht to the possession o the 'oods and

awardin' da(a'es to it in the s#( o 4D,>)>5, the a(o#nt


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shown to have been e/pended in orwardin' the 'oods to

Bladivostoc2) 0ro( this 3#d'(ent the deendant appealed)

The two (ain 7#estions raised by the appeal are, 8rst whether

the car'o belon'in' to the plaintif is liable to be (ade tocontrib#te, by way o 'eneral avera'e, to the costs and e/penses

inc#rred by reason o the intern(ent o the Sueviain the port o

Manila, and, secondly, whether the deendant is liable or the

e/penses o transerrin' the car'o to another ship and

transportin' it to the port o destination)

9pon the 8rst 7#estion it is clear that the car'o in 7#estion is not

liable to a 'eneral avera'e) 1t is not clai(ed that this a'ric#lt#ral

(achinery was contraband o war= and bein' ne#tral 'oods, itwas not liable to oreit#re in the event o capt#re by the ene(ies

o the ship+s a') 1t ollows that when the (aster o the Suevia

decided to ta2e re#'e in the port o Manila, he acted e/cl#sively

with a view to the protection o his vessel) There was no common

dan'er to the ship and car'o= and thereore it was not a case or a

'eneral avera'e) The point here in disp#te has already been

deter(ined by this co#rt #navorably to the contention o the

appellant) ;&o(pa'nie de &o((erce et de Aavi'ation +E/tre(eOrient vs.Ha(b#r' %(eri2a 4ac2etacht %ctien esselschat, G6

4hil), D!*)< The ollowin' provision contained in the Yor2?%ntwerp

R#les, as we interpret it, is concl#sive a'ainst the appellant+s

contention:

hen a ship shall have entered a port o re#'e ) ) ) in

conse7#ence o accident, sacri8ce, or other e/traordinary

circ#(stance which renders that necessary or the co((on

saety, the e/pense o enterin' s#ch port shall be ad(itted as'eneral avera'e) ;Yor2?%ntwerp R#les, section *)


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the 'oods to Bladivostoc2, even tho#'ht it is i((ediately

absolved ro( the d#ty to convey the( on its own ship)

1t (#st not be or'otten that the o#tbrea2 o the war between

er(any and R#ssia did not (a2e the contract o afrei'ht(entabsol#tely ille'al ass between the er(an co(pany and the

%(erican shipper) 1 war had bro2en o#t between er(any and

the 9nited States, and re#'e had been ta2en in so(e port in a

ne#tral co#ntry, it (i'ht be said that this contract was dissolved

on both sides, and a diferent 7#estion wo#ld th#s have been

presented= b#t even in that case, it co#ld not be s#ccess#lly

(aintained that the er(an co(pany was wholly absolved ro(

every d#ty to the shipper)

There is another aspect o the case which is hi'hly pertinent to

the (atter now #nder consideration) The rei'ht was prepaid by

the shipper ro( $alti(ore to destination, b#t has been only in

part earned) The deendant co(pany has bro2en the voya'e by

stoppin' at the inter(ediate port o Manila) %d(ittin' that the

deendant co(pany is absolved ro( the obli'ation to convey the

car'o #rther on its co#rse, it is nevertheless clear that #pon

principles o e7#ity the co(pany sho#ld be bo#nd to restore so

(#ch o the rei'ht a represents the #nacco(plished portion o

the voya'e) 1 the rei'ht had not been paid, the (ost that co#ld

be clai(ed by the deendant wo#ld be an a(o#ntpro rata itineris

peracti, as was conceded in the case o the Teutonia, to which

reerence has been already (ade= and now that the rei'ht has

been prepaid, there is a clear obli'ation on the part o the

co(pany to re#nd the e/cess, as (oney paid #pon a

consideration that has partially ailed)

$#t it will be said that the contract to convey the car'o to

Ha(b#r' and to orward it ro( there to Bladivostoc2 was an

entirety, and that inas(#ch as the deendant co(pany is

absolved ro( its obli'ation to proceed #rther with peror(ance,

there can be no apportion(ent as between the voya'e which has


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been acco(plished and that which was yet to be peror(ed) The

reply to this is that the brea2 in the contin#ity o the voya'e was

a res#lt o the vol#ntary act o the (aster o the Suevia, adopted

with a view to the preservation o the ship= and it can not be

per(itted that the deendant co(pany sho#ld escape theconse7#ences o that act, so ar as necessary to efect an

e7#itable ad3#st(ent o the ri'hts o the owner o the car'o)

There bein' no evidence beore #s with respect to the a(o#nt o

rei'ht which was prepaid, nor with respect to the proportion

earned and #nearned, b#t only the act that the owner paid o#t a

certain a(o#nt or tranship(ent to Bladivostoc2, it can be

ass#(ed that this a(o#nt appro/i(ately represents the #nearned

portion o the rei'ht)

e have not overloo2ed the provision in the ori'inal bill o ladin'

which provides that rei'ht paid in advance will not be ret#rned,

'oods lost or not lost) There is also a so(ewhat si(ilar provision

in the second bill o ladin' iss#ed at Ha(b#r') These provisions

conte(plate the special cae o the loss o the 'oods and can not

be e/tended to the sit#ation which arises when the ship or

p#rposes o its own protection abandons the enterprise)

0ro( what has been said it is apparent that the &o#rt o 0irst

1nstance was correct not only in ad3#d'in' possession o the car'o

to the plaintif b#t also in i(posin' #pon the deendant co(pany

liability with respect to the a(o#nt e/pended by the plaintif in

orwardin' the 'oods to their destination)

The only other point raised by the bill o e/ceptions, which we

dee( it necessary to notice, is based on a provision in the bill o

ladin' to the efect that all disp#tes arisin' #nder the contractare, at the option o the deendant co(pany, to be decided

accordin' to er(an law and e/cl#sively by the Ha(b#r' co#rts)

0ro( this it is ar'#ed that the &o#rt o 0irst 1nstance erred in

ass#(in' 3#risdiction o the action and that the case sho#ld have

been decided in accordance with the principles o er(an law)


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1t can not be ad(itted that a provision o this character has the

efect o o#stin' the 3#risdiction o the co#rt o the 4hilippine

1slands in the (atter now beore it) %n e/press a'ree(ent tendin'

to deprive a co#rt o 3#risdiction conerred on it by law is o no

efect) ;Molina vs.e la Riva, 6 4hil), >)< $esides, whatever theefect o this provision, the bene8t o it was waived when the

deendant co(pany appeared and answered 'enerally witho#t

ob3ectin' to the 3#risdiction o the co#rt)

%s re'ards the contention that the ri'hts o the parties sho#ld be

deter(ined in accordance with the law o er(any, it is s#Jcient

to say that when it is proposed to invo2e the law o a orei'n

co#ntry as s#pplyin' the proper r#les or the sol#tion o a case,

the e/istence o s#ch law (#st be pleaded and proved) eendant

has done neither) 1n s#ch a case it is to be pres#(ed that the law

prevailin' in the orei'n co#ntry is the sa(e as that which

prevails in o#r own)

The 3#d'(ent appealed ro( is aJr(ed, with costs a'ainst the

appellant) So ordered

G.R. No. L-56'9/ May '0, 1991SMI#* )LL AN C$MANY 2*ILIIN)S, INC. an% #$4Y$

MARIN) AN IR) INSRANC) C$., INC., ptitionr",!".

#*) C$R# $ A)ALS an% CARL$S A. G$ #*$NG ANC$., r"pon%nt".

1n the early (ornin' o G May !C*@at e/actly *GD* ho#rs, on

the approaches to the port o Manila near &aballo 1sland, acollision too2 place between the MLB "Don Carlos," an inter?island

vessel owned and operated by private respondent &arlos %) o

Thon' and &o(pany ;"o Thon'"


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"Yotai Maru" was approachin' the port o Manila, co(in' in ro(

obe, Iapan) The bow o the "Don Carlos" ra((ed the portside

;let side< o the "Yotai Maru" inictin' a three ;G< c() 'apin' hole

on her portside near Hatch Ao) G, thro#'h which seawater r#shed

in and ooded that hatch and her botto( tan2s, da(a'in' all thecar'o stowed therein)

The consi'nees o the da(a'ed car'o 'ot paid by their ins#rance

co(panies) The ins#rance co(panies in t#rn, havin' been

s#bro'ated to the interests o the consi'nees o the da(a'ed

car'o, co((enced actions a'ainst private respondent o Thon'

or da(a'es s#stained by the vario#s ship(ents in the then &o#rt

o 0irst 1nstance o Manila)

Two ;>< cases were 8led in the &o#rt o 0irst 1nstance o Manila)

The 8rst case, &ivil &ase Ao) 5>D6C, was co((enced on G March

!C by petitioner S(ith $ell and &o(pany ;4hilippinesD6C ;I#d'e 0ernande.< and 5>DD6 ;I#d'e

evas< were tried #nder the sa(e iss#es and evidence relatin'

to the collision between the "Don Carlos" and the "Yotai Maru" the

parties in both cases havin' a'reed that the evidence on the

collision presented in one case wo#ld be si(ply adopted in theother) 1n both cases, the Manila &o#rt o 0irst 1nstance held that

the oJcers and crew o the "Don Carlos" had been ne'li'ent that

s#ch ne'li'ence was the pro/i(ate ca#se o the collision and

accordin'ly held respondent o Thon' liable or da(a'es to the

plaintif ins#rance co(panies) I#d'e 0ernande. awarded the


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ins#rance co(panies 4!,55!)C! with le'al interest pl#s

4G,***)** as attorney+s ees= while I#d'e evas awarded the

plaintif ins#rance co(panies on two ;>< clai(s 9S N 65,6*)** or

its e7#ivalent in 4hilippine c#rrency pl#s attorney+s ees o

4G*,***)**, and 4!,6G)*> pl#s 4D,***)** as attorney+s ees,respectively)

The decision o I#d'e 0ernande. in &ivil &ase Ao) 5>D6C was

appealed by respondent o Thon' to the &o#rt o %ppeals, and

the appeal was there doc2eted as &)%)?)R) Ao) 6G>*?R) The

decision o I#d'e evas in &ivil &ase Ao) 5>DD6 was also

appealed by o Thon' to the &o#rt o %ppeals, the appeal bein'

doc2eted as &)%)?)R) Ao) 6>*6?R) S#bstantially identical

assi'n(ents o errors were (ade by o Thon' in the two ;>*?R, the &o#rt o %ppeals thro#'h Reyes,

-)$),J), rendered a ecision on 5 %#'#st !C5 aJr(in' the

ecision o I#d'e 0ernande.) 4rivate respondent o Thon' (oved

or reconsideration, witho#t s#ccess) o Thon' then went to the

S#pre(e &o#rt on 4etition or Review, the 4etition bein' doc2eted

as )R) Ao) -?55G! ;"&arlos %) o Thon' and &o(pany v) S(ith$ell and &o(pany 4hilippinesP, 1nc), et al)" Ian#ary !C!)

1n the other ;evas< case, &)%)?)R) Ao) 6>*6?R, the &o#rt o%ppeals, on >6 Aove(ber !5* ;or al(ost two >P years ater the

ecision o Reyes, -)$),J), in &)%)?)R) Ao) 6G>*?R, had been

aJr(ed by the S#pre(e &o#rt on 4etition or Review< thro#'h

Sison, 4)B),J), reversed the evas ecision and held the oJcers

o the "Yotai Maru" at a#lt in the collision with the "Don Carlos,"


17/78

and dis(issed the ins#rance co(panies+ co(plaint) Herein

petitioners as2ed or reconsideration, to no avail)

The ins#rance co(panies are now beore #s on 4etition or Review

on Certiorari, assailin' the ecision o Sison, 4)B),J), in &)%)?)R)Ao) 6>*6?R) 4etitioners+ principal contentions are:

a) that the Sison ecision had disre'arded the r#le ores udicata=

b) that Sison 4)B),J), was in serio#s and reversible error in

acceptin' o Thon'+s deense that the 7#estion o a#lt on the

part o the "Yotai Maru" had been settled by the co(pro(ise

a'ree(ent between the owner o the "Yotai Maru" and o Thon'

as owner o the "Don Carlos!" and

c) that Sison, 4) B)J), was in serio#s and reversible error in holdin'

that the "Yotai Maru" had been ne'li'ent and at a#lt in the

collision with the "Don Carlos)"

1

The 8rst contention o petitioners is that Sison, 4) B)J) in renderin'

his 7#estioned ecision, ailed to apply the r#le o res udicata)

4etitioners (aintain that the Resol#tion o the S#pre(e &o#rtdated 6 ece(ber !C5 in )R) Ao) 55G! which dis(issed o

Thon'+s 4etition or Review o the ecision o Reyes, -)$),J), in

&)%)?)R) Ao) 6G>*?R, had efectively settled the 7#estion o

liability on the part o the "Don Carlos)" 9nder the doctrine o res

udicata, petitioners contend, Sison, 4) B)J) sho#ld have ollowed

the Reyes, -)$),J) ecision since the latter had been aJr(ed by

the S#pre(e &o#rt and had beco(e 8nal and e/ec#tory lon'

beore the Sison ecision was rendered)

4rivate respondent o Thon', #pon the other hand, ar'#es that

the S#pre(e &o#rt, in renderin' its (in#te Resol#tion in )R) Ao)

-? 55G!, had (erely dis(issed o Thon'+s 4etition or Review o

the Reyes, -)$),J) ecision or lac2 o (erit b#t had not aJr(ed

in totothat ecision) 4rivate respondent, in other words, p#rports


18/78

to distin'#ish between denial o a 4etition or Review or lac2 o

(erit and aJr(ance o the &o#rt o %ppeals+ ecision) Th#s, o

Thon' concl#des, this &o#rt did not hold that the "Don Carlos"

had been ne'li'ent in the collision)

4rivate respondent+s ar'#(ent (#st be re3ected) That this &o#rt

denied o Thon'+s 4etition or Review in a (in#te Resol#tion did

not in any way di(inish the le'al si'ni8cance o the denial so

decreed by this &o#rt) The S#pre(e &o#rt is not co(pelled to

adopt a de8nite and strin'ent r#le on how its 3#d'(ent shall be

ra(ed) 1t has lon' been settled that this &o#rt has discretion to

decide whether a "(in#te resol#tion" sho#ld be #sed in lie# o a

#ll?blown decision in any partic#lar case and that a (in#te

Resol#tion o dis(issal o a 4etition or Review on certiorari

constit#tes an adudication on the meritso the controversy or

s#b3ect (atter o the 4etition) >1t has been stressed by the &o#rt

that the 'rant o d#e co#rse to a 4etition or Review is "not a

(atter o ri'ht, b#t o so#nd 3#dicial discretion= and so there is no

need to #lly e/plain the &o#rt+s denial) 0or one thin', the acts

and law are already (entioned in the &o#rt o %ppeals+ opinion)"G

% (in#te Resol#tion denyin' a 4etition or Review o a ecision o

the &o#rt o %ppeals can only (ean that the S#pre(e &o#rt

a'rees with or adopts the 8ndin's and concl#sions o the &o#rt o

%ppeals, in other words, that the ecision so#'ht to be reviewed

and set aside is correct)

4rivate respondent o Thon' ar'#es also that the r#le o res

udicatacannot be invo2ed in the instant case whether in respect

o the ecision o Reyes, -)$),J) or in respect o the Resol#tion o

the S#pre(e &o#rt in )R) Ao) -?55G!, or the reason that therewas no identity o parties and no identity o ca#se o action

between &)%)?)R) Ao) 6>*6?R and &)%)?)R) Ao) 6G>*?R)

The parties in &)%)?)R) Ao) 6G>*?R here the decision o I#d'e

0ernande. was aJr(ed, involved S(ith $ell and &o(pany

;4hilippines


19/78

-td) while the petitioners in the instant case ;plaintifs below< are

S(ith $ell and &o) ;4hilippines< cases, altho#'h the co?petitioner in one was an

ins#rance co(pany diferent ro( the ins#rance co(pany co?petitioner in the other case) 1t sho#ld be noted, (oreover, that

the co?petitioner in both cases was an ins#rance co(pany arid

that both petitioners in the two ;>< cases represented the sa(e

interest, i.e), the car'o owner+s interest as a'ainst the h#ll

interest or the interest o the shipowner) More i(portantly, both

cases had been bro#'ht a'ainst the sa(e deendant, private

respondent o Thon', the owner o the vessel "Don Carlos)" 1n

s#(, &)%)?)R) Ao) 6G>*R and &)%?)R) Ao) 6>*6?R e/hibiteds#bstantial identity o parties)

1t is conceded by petitioners that the s#b3ect (atters o the two

;>< s#its were not identical, in the sense that the car'o which had

been da(a'ed in the one case and or which inde(nity was

so#'ht, was not the very sa(e car'o which had been da(a'ed in

the other case inde(nity or which was also so#'ht) The ca#se o

action was, however, the sa(e in the two ;>< cases, i.e), the sa(e

ri'ht o the car'o owners to the saety and inte'rity o their car'o

had been violated by the sa(e cas#alty, the ra((in' o the

"Yotai Maru" by the "Don Carlos)" The 3#d'(ents in both cases

were 8nal 3#d'(ents on the (erits rendered by the two ;>< concepts e(braced in the principle o res
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20/78

udicata# i.e), "bar by or(er 3#d'(ent" and "concl#siveness o

3#d'(ent:"

There is no 7#estion that where as between the 8rst case here

the 3#d'(ent is rendered and the second case where s#ch3#d'(ent is invo2ed, there is identity o parties, s#b3ect?(atter

and ca#se o action, the 3#d'(ent on the (erits in the 8rst case

constit#tes an absol#te bar to the s#bse7#ent action not only as

to every (atter which was ofered and received to s#stain or

deeat the clai( or de(and, b#t also as to any other ad(issible

(atter which (i'ht have been ofered or that p#rpose and to all

(atters that co#ld have been ad3#d'ed in that case) This is

desi'nated as "$ar $% "ormer udgment)"

$#t where the second action between the sa(e parties is #pon a

diferent clai( or de(and,the udgment in the prior action

operates as an estoppel onl% as to those matters in issue or

points controverted# upon the determination o" &hich the 'nding

or udgment &as rendered) 1n 8ne, the previo#s 3#d'(ent is

concl#sive in the second case, only as those (atters act#ally and

directly controverted and deter(ined and not as to (atters

(erely involved therein) This is the r#le on (conclusiveness o"udgment+ e(bodied in s#bdivision ;c< o Section ! o R#le G! o

the Revised R#les o+ &o#rt)C;&itations o(itted< ;E(phases

s#pplied< or (ore

persons who, in order to orestall or p#t an end to a law s#it,

ad3#st their diferences by (#t#al consent, an ad3#st(ent which

everyone o the( preers to the hope o 'ainin' (ore, balanced

by the dan'er o losin' (ore) >%n ofer to co(pro(ise does

not, in le'al conte(plation, involve an ad(ission on the part o a

deendant that he is le'ally liable, nor on the part o a plaintifthat his clai( or de(and is 'ro#ndless or even do#bt#l, since the

co(pro(ise is arrived at precisely with a view to avoidin' #rther

controversy and savin' the e/penses o liti'ation) G1t is o the

very nat#re o an ofer o co(pro(ise that it is (ade tentatively,

hypothetically and in conte(plation o (#t#al concessions)
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23/78

The above r#le on co(pro(ises is anchored on p#blic policy o

the (ost insistent and basic 2ind= that the incidence o liti'ation

sho#ld be red#ced and its d#ration shortened to the (a/i(#(

e/tent easible)

The collision between the "Yotai Maru" and the "Don Carlos"

spawned not only sets o liti'ations b#t also ad(inistrative

proceedin's beore the $oard o Marine 1n7#iry ;"$M1" March

!5, o Thon' 8led a (otion or a 8nal e/tension o ti(e and

8led its record on appeal on C March !5) The 4& noted that

o Thon'+s record on appeal was 8led late, that is, seven ;C< days
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24/78

ater the last e/tension 'ranted by the 4& had e/pired)

Aevertheless, on I#ly !5 ;ater the 4etition or Review on

Certiorariin the case at bar had been 8led with this &o#rt6)C, !C6, the &o#rt o 0irst 1nstance o &eb# rendered

a decision in &ivil &ase Ao) R?!CG ;&arlos %) o Thon' vs) San?

yo Marine &o)< holdin' that MS "YOT%1 M%R9" was solely

responsible or the collision, which decision was #pheld by the

&o#rt o %ppeals)

The "oregoing udicial pronouncements rendered a"ter the 'nalit%

o" the C/ Commandant(s decision o" Ma% 01# 0123# &ere

supervening causes or reasons that rendered the C/

Commandant(s decision as no longer en"orcea$le and entitled M6

"D78 CA+)7S"to request the Minister o" 8ational De"ense to

modi"% or alter the questioned decision to harmoni*e the same

&ith ustice and tile "acts) ;e la &osta vs) &leoas, 6C 4hil) 656=&ity o $#t#tan vs) Orti., G S&R% 6D!= &andelario vs) &ani.ares,

S&R% CG5= %bellana vs) osdos, G S&R% >


26/78

4etition at bar and thereore not 8nal) %t the sa(e ti(e, the OJce

o the 4resident either i'nored or was #naware o the Reyes, -)$),

J), ecision in &)%)?)R) Ao 6G>*?R 8ndin' the "Don Carlos" solely

liable or the collision, and o the act that that ecision had been

aJr(ed by the S#pre(e &o#rt and had lon' a'o beco(e 8naland e/ec#tory) % third (isapprehension o the OJce o the

4resident related to a decision in a &eb# &o#rt o 0irst 1nstance

liti'ation which had been settled by the co(pro(ise a'ree(ent

between the Sanyo Marine &o(pany and o Thon') The OJce o

the 4resident (ista2enly believed that the &eb# &o#rt o 0irst

1nstance had rendered a decision holdin' the "Yotai Maru" solely

responsible or the collision, hen in tr#th the &eb# co#rt had

rendered a 3#d'(ent o dis(issal on the basis o the co(pro(isea'ree(ent) The &eb# decision was not, o co#rse, appealed to the

&o#rt o %ppeals)

1t th#s appears that the decision o the OJce o the 4resident

#pholdin' the belated reversal by the Ministry o Aational eense

o the 4&+S decision holdin' the "Don Carlos" solely liable or the

collision, is so deeply awed as not to warrant any #rther

e/a(ination) 9pon the other hand, the basic decision o the 4&

holdin' the "Don Carlos" solely ne'li'ent in the collision re(ains

in efect)

11

1n their 4etition or Review, petitioners assail the 8ndin' and

concl#sion o the Sison ecision, that the "Yotai Maru" was

ne'li'ent and at a#lt in the collision, rather than the "Don

Carlos)" 1n view o the concl#sions reached in 4art 1 above, it (ay

not be strictly necessary to deal with the iss#e o the correctnesso the Sison ecision in this respect) The &o#rt considers,

nonetheless, that in view o the conictin' concl#sions reached by

Reyes, -)$),J), on the one hand, and Sison, 4)B),J), on the other,

and since in aJr(in' the Reyes ecision, the &o#rt did not

en'a'e in a detailed written e/a(ination o the 7#estion o which


27/78

vessel had been ne'li'ent, and in view o the i(portance o the

iss#es o ad(iralty law involved, the &o#rt sho#ld #nderta2e a

care#l review o the record o the case at bar and disc#ss those

iss#es in e4tenso)

The decision o I#d'e evas in &ivil &ase Ao) 5>DD6 is (ar2ed by

care#l analysis o the evidence concernin' the collision) 1t is

worth #nderscorin' that the 8ndin's o act o I#d'e 0ernande. in

&ivil &ase Ao) 5>D6C ;which was aJr(ed by the &o#rt o %ppeals

in the Reyes ecision and by this &o#rt in )R) Ao) -?55G!< are

3#st abo#t identical with the 8ndin's o I#d'e evas) E/a(inin'

the acts as o#nd by I#d'e evas, the &o#rt believes that there

are three ;G< principal actors which are constit#tive o ne'li'ence

on the part o the "Don Carlos," which ne'li'ence was the

pro/i(ate ca#se o the collision)

The 8rst o these actors was the ail#re o the "Don Carlos" to

co(ply with the re7#ire(ents o R#le 5 ;a< o the 1nternational

R#les o the Road ;"R#les"


28/78

'reen li'ht o the other or where a red li'ht witho#t a 'reen li'ht

or a 'reen li'ht witho#t a red li'ht is seen ahead, or here both

'reen and red li'hts are seen anywhere b#t ahead) ;E(phasis

s#pplied*! and

>**The

collision occ#rred at e/actly G:D* a)()

The second circ#(stance constit#tive o ne'li'ence on the part o

the "Don Carlos" was its ail#re to have on board that ni'ht a

"proper loo2?o#t" as re7#ired by R#le 1 ;$< 9nder R#le >! o the

sa(e set o R#les, all conse7#ences arisin' ro( the ail#re o the"Don Carlos" to 2eep a "proper loo2?o#t" (#st be borne by the

"Don Carlos)" I#d'e evas+ s#((ary o the evidence said:

The evidence on record li2ewise discloses very convincin'ly that

"on &arlos" did not have "loo2?o#t" whose sole and only d#ty is

only to act as S#ch) ) ) ) >
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30/78

% "proper loo2?o#t" is one who has been trained as s#ch and who

is 'iven no other d#ty save to act as a loo2?o#t and who is

stationed where he can see and hear best and (aintain 'ood

co((#nication with the oJcer in char'e o the vessel, and who

(#st, o co#rse, be vi'ilant) I#d'e evas wrote:

The "loo2?o#t" sho#ld have no other d#ty to peror()

;&ha(berlain v) ard, >, A)O)) 6>, 9)S) D5, DC>, 0ed) 6!6CG


31/78

command o" Benito /erman# a second mate although its captain#

Captain +ivera# &as ver% much in the said vessel at the time. The

de"endant(s evidence appears $ere"t o" anye4planation as to &h%

second mate /erman &as at the helm o" the a"oresaid vessel

&hen Captain +ivera did not appear to $e under an% disa$ilit% atthe time) 1n this connection, %rticle 6GGP o the &ode o

&o((erce provides:

%rt) 6GGP @ The second (ate shall ta2e co((and o the vessel

in case o the inability or dis7#ali8cation o the captain and sailin'

(ate, ass#(in', in s#ch case, their powers and liability)

The act that second (ate er(an was allowed to be in co((and

o "on &arlos" and not the chie or the sailin' (ate in theabsence o &aptain Rivera, 'ives rise to no other concl#sion

e/cept that said vessel hadP no chie (ate) Otherwise, the

deense evidence sho#ld have at least e/plained why it was

er(an, only a second (ate, who was at the hel( o the vessel

"on &arlos" at the ti(e o the atal collision)

$#t that is not all)5orst still# aside "rom /erman(s $eing onl% a

second mate# is his apparent lac; o" sucient ;no&ledge o" the

$asic and generall% esta$lished rules o" navigation. or instance#

he appeared una&are o" the necessit% o" emplo%ing a"loo;: out"

;t)s)n) I#ne 6, !C, pa'e >C< which is (aniest even in his

testi(ony beore the $oard o Marine 1n7#iry on the sa(e s#b3ect

;E/h) >, pa'e >*!G;E(phasis s#ppliedD o the total a(o#nt d#e as attorney+s ees, by 8lin' a

co(plaint or recovery o s#( o (oney ;4etition, p)


38/78

the (otion now #nder consideration, deendant prays or the

reconsideration o the order o Septe(ber 5, !5! and in lie#

thereo, another order be entered dis(issin' plaintif+s co(plaint)

There appears to be 'ood reasons or the co#rt to ta2e a secondloo2 at the iss#es raised by the deendant)

/// /// ///

1t is not disp#ted deendants that the loss s#fered by the

ship(ent is only )5 or less that o the interest o the

consi'nee on the car'o 1nvo2in' the provision o the %rticle 55 o

the &ode o &o((erce which reads:

&lai(s or avera'e shall not be ad(itted i they do not e/ceed8ve percent o the interest which the clai(ant (ay have in the

vessels or car'o i it is 'ross avera'e, and one percent o" the

goods damaged i" particular average# ded#ctin' in both cases the

e/penses o appraisal, #nless there is an a'ree(ent to the

contrary) ;E(phasis s#pplied, citin' $ar'ett v) 1ns#rance &o) G $osw) A)Y)P G!D


39/78

e/penses necessarily inc#rred or the co((on bene8t and saety

o all ;$id)#citin' &aliornia &anneries &o) v) &anton 1ns) OJce >D

&al) %pp) G*G, G p) D!?DDGC= %nne/ %, pp) G?6, !!* ;supra


40/78

1n a resol#tion dated ece(ber *, !!*, this &o#rt 'ave d#e

co#rse to the petition and re7#ired both parties to 8le their

respective (e(oranda ;+ollo, p) D5 o the R#les o &o#rt, s#b3ect petition raised

7#estions which i at all, constit#tin' 'rave ab#se o discretion

correctible bycertiorari)

Evidently, the &o#rt o %ppeals did not err in dis(issin' the

petition or certiorarior as r#led by this &o#rt, an order o

dis(issal whether ri'ht or wron' is a 8nal order, hence, a proper

s#b3ect o appeal, not certiorari;Marahay v) Melicor, 5 S&R%

5 ;!!*P


41/78

co#rt re#sed to consider the $ill o -adin' as the law 'overnin'

the parties)

4rivate respondent co#ntered that in all (atters not covered by

the &ivil &ode, the ri'hts and obli'ations o the parties shall be'overned by the &ode o &o((erce and by special laws as

provided or in %rticle C66 o the &ivil &ode= that %rticle 5*6, 5*!

and 55 o the &ode o &o((erce sho#ld be applied s#ppletorily

as they provide or the e/tent o the co((on carriers+ liability)

This iss#e has been resolved by this &o#rt in 8ational

Development Co)v)C)A) ;6 S&R% D!G !55P= citin' Kastern

Shipping )ines# nc)v))A)C), D* S&R% 6!, C* !5CP where it

was held that "the law o the co#ntry to which the 'oods are to betransported persons the liability o the co((on carrier in case o

their loss, destr#ction or deterioration)" ;%rticle CDG, &ivil &ode


42/78

in3#ry or loss was ca#sed by its own ne'li'ence) Otherwise stated,

the law on avera'es #nder the &ode o &o((erce cannot be

applied in deter(inin' liability where there is ne'li'ence ;$id), p)

6*6> bales were o#nd to beda(a'edLlost with straps c#t or loose, calc#lated by the so?called

"percenta'e (ethod" at ,G6* 2ilo'ra(s and a(o#ntin' to

46,>6G) ;+ollo#p) 65>

bales was d#e to the ne'li'ence or a#lt o AM& ;+ollo, p) C!


43/78

%ccordin'ly, it is evident that the 8ndin's o respondent &o#rt o

%ppeals, aJr(in' the 8ndin's and concl#sions o the co#rt a quo

are not s#pported by law and 3#rispr#dence)

4REM1SES &OAS1ERE, ;< the decisions o both the &o#rt o%ppeals and the Re'ional Trial &o#rt o Manila, $ranch ,

appealed ro( are REBERSE= and ;>< private respondent

Aational Marine &orporation is hereby ordered to rei(b#rse the

s#bro'ee, petitioner %(erican Ho(e %ss#rance &o(pany, the

a(o#nt o 4G,D*6)CD)

G.R. No. L-'5050 Mar78 1(, 196

$MING$ ANG,plaintif?appellant,vs)

AM)RICAN S#)AMS*I AG)NCI)S, INC.,deendant?appellee)

These are two cases separately appealed to the &o#rt o

%ppeals and certi8ed to 9s by said &o#rt) Since both appeals

involve the sa(e parties and iss#e, they are decided

to'ether herein)

Ya# Y#e &o((ercial $an2, -td) o Hon'2on', also reerred to

hereater as Ya# Y#e, a'reed to sell one boat ;D* eet, G*


44/78

tons< containin' #sed 9)S) Military S#rpl#s to one avao

Merchandisin' &orp) or the s#( o N5,5>*)>C ;9S

cases ;6> sets and ! pieces< o Hiranos %#to(atic &op

&han'e or &otton -oo( or &alieo to one Her(inio Teves or

the s#( o N5,>6),6D ;9S cases ;6> sets and ! pieces < o Hiranos

%#to(atic &op &han'e or &otton -oo( or &alico at Aa'oya,

aboard the "S)S) &E-E$ES M%R9", or Manila, with the ansai

Stea(ship &o), -td) o Osa2a, Iapan, as carrier, o which the

%(erican Stea(ship %'encies, 1nc) is the a'ent in the

4hilippines, #nder a shippin' a'ree(ent, $ill o -adin' Ao)

AM , dated 0ebr#ary C, !6, consi'ned "to order o theshipper", with Her(inio ) Teves as the party to be noti8ed

o the arrival o said articles)0L&ph0.NOt

Si(ilarly, on I#ne G, !6, the 9nited States &ontractin'

OJcer, on behal o Aippon Tradin' Sho2ai or Aishi(an


45/78

aihats# &o), -td) shipped the boat containin' 9)S) Military

S#rpl#s at Yo2oha(a, Iapan, the "YOI9 M%R9", with San2yo

i#n ab#shi2i aisha o Iapan as carrier, o which the

%(erican Stea(ship %'encies, 1nc) is the a'ent in the

4hilippines, #nder a shippin' a'ree(ent, $ill o -adin' Ao)YM?G, dated I#ne G, !6, consi'ned "to the order o Ya# Y#e

&o((ercial $an2, -td) o Hon'2on'", with avao

Merchandisin' &orporation as the party to be noti8ed o the

arrival o said boat)

The bills o ladin' were indorsed to the order o Ya# Y#e and

delivered to it by the respective shippers) 9pon receipt

thereo, Yan Y#e drew de(and drats to'ether with the billso ladin' a'ainst Teves and avao Merchandisin' &orp),

thro#'h the Hon'2on' F Shan'hai $an2)

The ship(ent or Teves arrived in Manila on March >, !6=

that o avao Merchandisin' &orp), arrived on I#ne *, !6)

%ccordin'ly, Hon'2on' F Shan'hai $an2 noti8ed Teves and

the avao Merchandisin' &orporation, the "notiy parties"

#nder the bills o ladin', o the arrival o the 'oods and

re7#ested pay(ent o the de(and drats representin' the

p#rchase prices o the articles) The avao Merchandisin'

&orp) and Teves, however, did not pay the respective drats,

pro(ptin' the ban2 in both cases to (a2e the correspondin'

protests) The ban2 li2ewise ret#rned the bills o ladin' and

de(and drats to Ya# Y#e which indorsed both bills o ladin'

to o(in'o %n')

Teves and avao Merchandisin' &orporation, however, wereable to obtain ban2 '#aranties in avor o the %(erican

Stea(ship %'encies), 1nc), as carriers+ a'ent, to the efect

that they wo#ld s#rrender the ori'inal and ne'otiable bills o

ladin' d#ly indorsed by Ya# Y#e) %nd on the stren'th o said

'#aranties, avao Merchandisin' &orp) and Teves each


46/78

s#cceeded in sec#rin' a "4er(it To eliver 1(ported %rticles"

ro( the carriers+ a'ent, which they presented to the $#rea#

o sto(s) 1n t#rn the latter released to the( the articles

covered by the bills o ladin')

%ter bein' inor(ed by the %(erican Stea(ship %'encies

that the articles covered by the respective bills o ladin'

were already delivered by the( to the avao Merchandisin'

&orp) and to Teves, o(in'o %n' 8led clai(s with the

carriers+ a'ent or the cost o said articles, interests and

da(a'es) The %(erican Stea(ship %'encies, 1nc), however,

re#sed pay(ent)

o(in'o %n' thereater 8led separate co(plaints in the

&o#rt o 0irst 1nstance o Manila a'ainst the %(erican

Stea(ship %'encies, 1nc), or havin' alle'edly wron'#lly

delivered andLor converted the 'oods covered by the bills o

ladin' belon'in' to plaintif %n', to the da(a'e and

pre3#dice o the latter) The s#it as to the Teves ship(ent was

8led on October G*, !6G= that reerrin' to the avao

Merchandisin' &orp)+s ship(ent was 8led on Aove(ber ,

!6G)

S#bse7#ently, deendant 8led (otions to dis(iss #pon the

'ro#nd that plaintif+s ca#ses o action have prescribed

#nder the &arria'e o oods by Sea %ct ;&o((onwealth %ct

Ao) 6D


47/78

March >, !6 ;Teves ship(ent< and I#ne *, !6 ;avao

Merchandisin' &orp) ship(ent cases 6> sets and !

piecesP o Hiranos %#to(atic &op &han'e or &otton -oo(or &alico< on the 'ro#nd o prescription) His (otion or

reconsideration dated March >*, !6 havin' been denied

by the lower co#rt in its order dated I#ne D, !6, plaintif

appealed to the &o#rt o %ppeals) This is now -?>D*D* and

reers to the Teves ship(ent)

9pon the other hand, by order dated Ian#ary 6, !6, the

lower co#rt presided over by the Hon) Ies#s 4) More ; in re

the boat D* eet, G* tonsP containin' #sed 9)S) Military

S#rpl#s< denied the (otion to dis(iss on the 'ro#nd that

there bein' no alle'ation in the co(plaint as to the date o

arrival o the car'o or the date o which it sho#ld have been

delivered, the deendant was relyin' on acts which are not

yet in evidence s#ch as pres#(in' that the car'o had

arrived on the speci8c date and that the sa(e had been

delivered on another speci8c date)

9pon a (otion or reconsideration 8led by the deendant on

Ian#ary G, !6 and ater the parties s#b(itted their

(e(oranda o a#thorities and co#nter?a#thorities,

respectively, the lower co#rt by an order dated 0ebr#ary >*,

!6, reconsidered its prior order o Ian#ary 6, !6 and


48/78

dis(issed plaintif+s action also on the 'ro#nd o

prescription) 0ro( this order, deendant appealed to the

&o#rt o %ppeals) This is now -?>D*C and reers to the

avao Merchandisin' &orp) ship(ent)

%t iss#e is a 7#estion p#rely o law, na(ely: id plaintif?

appellant+s ca#ses o action prescribe #nder Section G;6


49/78

o carria'e #nder consideration entered into by and between

%(erican Stea(ship %'encies, 1nc) and the Ya# Y#e ;which

later on endorsed the bill o ladin' coverin' the ship(ent to

plaintif herein o(in'o %n'


50/78

e/i'encies o (ariti(e ha.ards) 1n a case where the 'oods

shipped were neither lost nor da(a'ed in transit b#t were,

on the contrary, delivered in port to so(eone who clai(ed to

be entitled thereto, the sit#ation is diferent, and the special

need or the short period o li(itation in case o loss orda(a'e ca#sed by (ariti(e perils does not obtain)

1t ollows that or s#its predicated not #pon loss or da(a'e

b#t on alle'ed (isdelivery ;or conversion< o the 'oods, the

applicable r#le on prescription is that o#nd in the &ivil &ode,

na(ely, either ten years or breach o a written contract or

o#r years or 7#asi?delict ;%rts) P, 6, &ivil

&ode


51/78

hereore, the orders appealed ro( dis(issin' plaintif+s

co(plaints in these two cases on the 'ro#nd o prescription

are hereby reversed and set aside= let said cases be

re(anded to the respective co#rt a quo or #rther

proceedin's) So ordered)

G.R. No. L-'/515 No!:;r 1(, 196

#*) AM)RICAN INSRANC) C$MANY,plaintif?appellant,

vs)C$MA, a certain car'o ins#red with plaintifcorporation was shipped in Aew Yor2, 9)S) aboard "MLS

TORE%OR", o which the 'eneral a'ent in the 4hilippines is

appellee Macondray F &o), 1nc) ;hereinater reerred to as

Macondray


52/78

&10 &eb#, was consi'ned to the order o the i(porter %tlas

&onsolidated Minin' and evelop(ent &orporation)

1nas(#ch as the 8nal port o call o the " MLS TORE%OR"

was Manila, the carrier, in acceptin' the car'o at the point oship(ent, a'reed to transship the sa(e, ater its dischar'e

in Manila, aboard an inter?island vessel to its destination in

&eb#)

On Septe(ber 5, !6>, the " MLS TORE%OR" arrived at the

port o Manila and on the sa(e date dischar'ed the car'o in

7#estion) 4#rs#ant to the arran'e(ent the car'o was

s#bse7#ently loaded aboard the "SS S191IOR", an inter?

island vessel) The ship(ent was 8nally dischar'ed in &eb#

on Septe(ber >, !6>)

hen the consi'nee too2 delivery o the ship(ent it was

o#nd to be short o two ;>< pieces o tractor parts worth

N>,5G)55, or 4,*6G)> at the e/chan'e rate o 4G)!*>D)

4laintif paid the ins#red val#e o the lost (erchandise to the

consi'nee) To recover the said s#( o 4,*6G)> plaintif, as

s#bro'ee o the consi'nee ri'hts, 8led on Septe(ber >,!6G a co(plaint a'ainst the &o(paUia Mariti(a and the

Bisayan &eb# Ter(inal &o), 1nc) as alternative deendants)

The or(er was s#ed as operator and owner o "SS S191IOR"

and the latter as operator o the arrastre service at the port

o &eb# char'ed with the care and c#stody o all car'o

dischar'ed there)

1n view o Mariti(a+s alle'ation in its answer that the lost(erchandise had not act#ally been delivered to it, plaintif

8led on Aove(ber 6, !6 a (otion to ad(it its a(ended

co(plaint i(pleadin' Macondray and -#.on $ro2era'e

&orporation as additional deendants and eli(inatin' the

Bisayan &eb# Ter(inal &o), 1nc) %ccordin' to plaintif, "the


53/78

a(ended co(plaint is necessary in view o deendant

Mariti(a+s assertion and records tendin' to show that the

lost (erchandise was not delivered to it, contrary to

Macondray+s representation, even ater the 8lin' o the

ori'inal co(plaint, that the car'o was delivered to Mariti(a)"The a(ended co(plaint was ad(itted on Aove(ber ,

!6)

On ece(ber >G, !6 Macondray (oved to dis(iss the

a(ended co(plaint a'ainst it on the 'ro#nd that plaintif+s

action had already prescribed #nder the provisions o the

&arria'e o oods by Sea %ctwhich provides in section G

;6, when

the "MLS TORE%OR" arrived at the port o Manila and

dischar'ed the car'o or transship(ent to &eb# on board the

"SS S191IOR," and Septe(ber >, !6>, when the ship(ent

8nally arrived in &eb# and was dischar'ed the sa(e day)

The (otion to dis(iss was 'ranted and plaintif interposedthe present appeal ro( the order o dis(issal) 4laintif avers

that the one year prescriptive period provided or in the

&arria'e o oods by Sea %ct does not apply in this case,

which sho#ld be 'overned by the stat#te o li(itations in the

&ivil &ode) 1n s#pport o this contention it is pointed o#t that


54/78

the car'o in 7#estion was transship(ent car'o= that the

dischar'e thereo in Manila ter(inated the obli'ation o

Macondray as carrier= and that its obli'ation to transship the

car'o to &eb# was (erely that o a "orwardin' a'ent" o the

shipper) Reliance is placed on &la#se o the bill o ladin'which states:

This carrier, in (a2in' arran'e(ents or any transshippin'

or orwardin' vessel or (eans o transportation not operated

by this carrier shall be considered solely the "or&arding

agent o" the shipperand witho#t any other responsibility)

e do not see that the #se o the ter( "orwardin' a'ent o

the shipper" is decisive o the iss#e) %ccordin' to para'raph

o the a(ended co(plaint the car'o was loaded on board

the "MLS TORE%OR" in Aew Yor2, "rei'ht prepaid to &eb#

&ity ) ) ) p#rs#ant to the bill o ladin' Ao) G)" 1n other words,

the action is based on the contract o carria'e #p to the 8nal

port o destination, which was &eb# &ity, or which the

correspondin' rei'ht had been prepaid) The ollowin'

provisions o the bill o ladin' are the ones directly in point:

) This bill o ladin' shall have efect s#b3ect to the

provisions o the &arria'e o oods by Sea %ct o the 9nited

States o %(erica, approved %pril 6, !G6, which shall be

dee(ed to be incorporated herein and nothin' herein

contained shall be dee(ed a s#rrender by the &arrier o any

o its ri'hts or i((#nities or an increase o any o its

responsibilities or liabilities #nder said %ct) The provisions

stated in said %ct ;e/cept as (ay be otherwise speci8callyprovided herein< shall 'overn beore the 'oods are loaded on

and ater they are dischar'ed ro( the ship and thro#'ho#t

the entire ti(e the 'oods are in the c#stody o the &arrier) ) )

)


55/78

!) 1n any event the &arrier and the ship shall be dischar'ed

ro( all liability in respect o loss or da(a'e #nless s#it is

bro#'ht within one year ater delivery o the 'oods or the

date when the 'oods sho#ld have been delivered) ) ) )

The transship(ent o the car'o ro( Manila to &eb# was not

a separate transaction ro( that ori'inally entered into by

Macondray, as 'eneral a'ent or the "MLS TORE%OR") 1t

was part o Macondray+s obli'ation #nder the contract o

carria'e and the act that the transship(ent was (ade via

an inter?island vessel did not operate to re(ove the

transaction ro( the operation o the &arria'e o oods by

Sea %ct)

G.R. No. L-'9( Jun 15, 19

NI$N CARI) *ILIIN)S, INC. 2&or:rly NationalCar;on 8ilippin", In7., plaintif?appellant,

vs)

MANILA RAILR$A C$., "u;"titut% ;y t8 *ILIIN)NA#I$NAL RAIL=AYS, MANILA $R# S)R+IC) an%

AM)RICAN S#)AMS*I AG)NCI)S, INC.,

A>IN$, J.:

This is an ad(iralty and arrastre case) On ece(ber 5,

!6 the vessel DaishinMaruarrived in Manila with a car'o

o ,*** ba's o synthetic resin consi'ned to eneral $ase


56/78

Metals, 1nc) which later sold the car'o to 9nion &arbide

4hilippines, 1nc)

On the ollowin' day, ece(ber !, that car'o was delivered

to the Manila 4ort Service in 'ood order and condition e/ceptor twenty? 8ve ba's which were in bad order ;4ar) 1B and

%nne/es & to &?>D o Stip#lation o 0acts* and 0ebr#ary 6 and 5, !6> ei'ht h#ndred

ninety?ei'ht ;5!5< ba's o resin ;o#t o the ,*** ba's< were

delivered by the c#sto(s bro2er to the consi'nee) One

h#ndred two ba's were (issin') The contents o twenty?8ve

ba's were da(a'ed or pilered while they were in the

c#stody o the arrastre operator ;4ar) K11 and %nne/es and

H o Stip#lation o 0acts %ll in all 8ty ba's o#t o the 5!5

ba's were da(a'ed ;%nne/ ?D ba's o resin ;*> (issin' and D* da(a'ed< were

val#ed at N>)6D a ba' or a total val#e o N,!!>)5*, which

a(o#nt at the prevailin' rate o e/chan'e o 4G)5D to the

%(erican dollar, is e7#ivalent to 4C,*>)C5 ;%nne/ 1 o

Stip#lation o 0acts with the Manila 4ort Service, as arrastre operator,

and the %(erican Stea(ship %'encies, 1nc), as a'ent o the

carrier, a provisional clai( advisin' the( that the ship(ent

in 7#estion was "shorthanded, short delivered andLor landed

in bad order" ;%nne/es E and 0 o Stip#lation o 0acts were (ade by the

consi'nee with the arrastre operator and the a'ent o the

carrier ;%nne/es 1 and 1? o Stip#lation o 0acts The clai(s

were reiterated by the consi'nee+s lawyer in his letters dated

Septe(ber >6, !6> which were received by the carrier+s


57/78

a'ent and the arrastre operator on October , !6>

;%nne/es I and I? o Stip#lation o 0acts, !6> in the &o#rt o 0irst1nstance o Manila a'ainst the Manila Railroad &o(pany, the

Manila 4ort Service and the %(erican Stea(ship %'encies,

1nc) or the recovery o da(a'es a(o#ntin' to 4C,*>)C5 as

the val#e o the #ndelivered *> ba's o resin and the

da(a'ed D* ba's pl#s le'al rate o interest ro( the 8lin' o

the co(plaint and 4,*** as attorney+s ees)

9nion &arbide+s co(plaint was a do#ble?barrelled action or a

3oinder o two ca#ses o action) One was an action in

ad(iralty #nder the &arria'e o oods by Sea %ct a'ainst

the carrier+s a'ent or the recovery o 4,>C)D6 as the val#e

o twenty?8ve ba's o resin which were da(a'ed beore they

were landed ;%nne/ &?>D


58/78

%s above stated, the action was bro#'ht on ece(ber >,

!6+> or two days late, accordin' to the trial co#rt+s

rec2onin' ;&ivil &ase Ao) D>D6>D< ba's were da(a'ed

while in the carrier+s c#stody ;%nne/es & to &?>D and ? o

Stip#lation o 0acts


59/78

SE&) G) /// /// ///

;6< 9nless notice o loss or da(a'e and the 'eneral

nat#re o s#ch loss or da(a'e be 'iven in writin' to the

carrier or hi a'ent at the port o dischargebeore or atthe ti(e o the re(oval o the 'oods into the c#stody o

the person entitled to deliver% thereo #nder the

contract o carria'e, s#ch re(oval shall be pri(a acie

evidence o the deliver%by the carrier o the 'oods as

described in the bill o ladin') 1 the loss or da(a'e is

not apparent, the notice (#st be 'iven within three

days o the deliver%)

Said notice o loss or da(a'e (ay be endorsed #pon

the receipt or the 'oods 'iven by the person ta2in'

deliver%thereo)

The notice in writin' need not be 'iven i the state o

the 'oods has at the ti(e o their receipt been the

s#b3ect o 3oint s#rvey or inspection)

1n any event the carrier and the ship shall bedischar'ed ro( all liability in respect o loss or da(a'e

#nless s#it is bro#'ht within one year ater deliver%o

the 'oods or the date when the 'oods sho#ld have

been delivered:

rovided, That i a notice o loss or da(a'e, either

apparent or concealed, is not 'iven as provided or in

this section, that act shall not afect or pre3#dice the

ri'ht o the shipper to brin' s#it within one year ater

the delivery o the 'oods or the date when the 'oods

sho#ld have been delivered)

1n the case o any act#al or apprehended loss or

da(a'e the carrier and the receiver shall 'ive all


60/78

reasonable acilities to each other or inspectin' and

tallyin' the 'oods) ;&o((onwealth %ct Ao) 6D,

adoptin' 9)S) 4#blic %ct Ao) D> o %pril 6,!G6


61/78

h#l2, la.aretto or crat or on any other place and be

stored there at the ris2 and e/pense o the shippers,

consi'nees or owners o the 'oods, any c#sto( o the

port to the contrary notwithstandin') 1n any case, the

&arrier+s liability is to cease as soon as the 'oods arelited ro( ship+s dec2 or leave the ship+s tac2le, any

c#sto( o the port to the contrary notwithstandin')

&onsi'nees to pay char'es or sortin' and stoc2in' the

'oods on whar or in shed)

1 the consi'nees ail to ta2e delivery o their 'oods

i((ediately the ship is ready to dischar'e the(, the

&arrier shall be at liberty to land and wareho#se ordischar'e the said 'oods into h#l2 or crat, or at any

other place at the ris2 and e/pense o the shippers,

consi'nees or owners o the 'oods witho#t notice)

D) 8otice o" Claim) %ny clai( or loss o or da(a'e to

the 'oods (#st be preerred in writin' to the &arrier+s

%'ents at the place o delivery within G days ater the

ship+s discharge thereo"# and $e"ore the goods are

removed "rom the qua% or ship(s P or place o"discharge, and in the event o s#ch clai( not bein'

preerred as above speci8ed, the clai( shall be dee(ed

as waived, and the &arrier shall be dischar'ed

therero()

S#it or the recovery o loss or da(a'e shall not in any

event be (aintainable a'ainst the &arrier or the ship

#nless instit#ted within one year ater the delivery othe written notice above speci8ed) The a(o#nt o clai(

shall be restricted to the &ash Bal#e o the 'oods at the

place and ti(e o ori'inal ship(ent pl#s all char'es

act#ally paid thereon, and all clai(s or either partial or


62/78

total loss or da(a'e shall be entertained and ad3#sted

#pon this basis o val#e) ;%nne/ $G) +eceiving Handling Custod% and Deliver% o"

Articles) @ The $#rea# o sto(s shall have "el#sive

s#pervision and control over the receivin', handlin',

c#stody and delivery o articles on the wharves and

piers at all ports o entry and in the e/ercise o its

#nctions it is hereby a#thori.ed to ac7#ire, ta2e over,

operate and s#perintend s#ch plants and acilities as

(ay be necessary or the receivin', handlin', c#stody

and delivery o articles, and the convenience and

co(ort o passen'ers and the handlin' o ba''a'e, as

well as to ac7#ire 8re protection e7#ip(ent or #se in

the piers:

rovided, That whenever in his 3#d'(ent the receivin',

handlin', c#stody and delivery o articles can be carriedon by private parties with 'reater eJciency, the

&o((issioner (ay, ater p#blic biddin' and s#b3ect to

the approval o the depart(ent head, contract with any

private party or the service o receivin', handlin',

c#stody and delivery o articles, and in s#ch event, the

contract (ay incl#de the sale or lease o 'overn(ent?

owned e7#ip(ent and acilities #sed in s#ch service)

The sensible and practical interpretation is that delivery

within the (eanin' o section G;6< o the &arria'e o oods

by Sea -aw (eans deliver% to the arrastre operator. That

delivery is evidenced by tally sheets which show whether the

'oods were landed in 'ood order or in bad order, a act


63/78

which the consi'nee or shipper can easily ascertain thro#'h

the c#sto(s bro2er)

To #se as basis or co(p#tin' the one?year period the

delivery to the consi'nee wo#ld be #nrealistic and (i'ht'enerate con#sion between the loss or da(a'e s#stained

by the 'oods while in the carrier+s c#stody and the loss or

da(a'e ca#sed to the 'oods while in the arrastre operator+s

possession)

%pparently, section G;6< adheres to the co((on?law r#le

that the d#ty i(posed water carriers was (erely to transport

ro( whar to whar and that the carrier was not bo#nd to

deliver the 'oods at the wareho#se o the consi'nee ;Tan Hi

vs) 9nited States, ! 0ed) S#pp) G>,GD


64/78

!6>) 1nas(#ch as the action was 8led on ece(ber >,

!6>, it was barred by the stat#te o li(itations)

eendant %(erican Stea(ship %'encies, 1nc), as a'ent o

the carrier, has no (ore liability to the consi'nee+s assi'nee,9nion &arbide 4hilippines, 1nc), in connection with the

da(a'ed twenty?8ve ba's o resin)

4rescription was d#ly pleaded by the said deendant in its

answer and (otion to dis(iss) That deense was correctly

entertained by trial co#rt)

Claim against the arrastre operator) @ The liability o the

arrastre contractor has a act#al and le'al basis diferentro( that o the carrier+s) The (ana'e(ent contract

between the Manila 4ort Service and the $#rea# o sto(s

provides:

D) ))) = in any event the &OATR%&TOR hall be relieved

and released o any and all responsibility or liability or

loss, da(a'e, (isdelivery, andLor non?delivery o

'oods, #nless s#it in the co#rt o proper 3#risdiction isbro#'ht within a period o one ;


65/78

when the clai( or the val#e o s#ch 'oods has been

re3ected or denied by the arrastre operator)

However, beore s#ch action can be 8led a condition

precedent sho#ld be co(plied with and that is, that a clai(;provisional or 8nal< shall have been previo#sly 8led with the

arrastre operator within 8teen days ro( the date o the

dischar'e o the last pac2a'e ro( the carryin' vessel

;&ontinental 1ns#rance &o(pany vs) Manila 4ort Service, -?

>>>*5, March G*,!66,6 S&R% >D*!, > S&R%, C, C5


66/78

4ort Service, supra) 4hilippine Ed#cation &o(pany vs) Manila

4ort Service, -?>G, October >!, !C, > S&R% G ba's o resin which were not

delivered, and twenty?8ve ba's, which were da(a'ed, or a

total o one h#ndred twenty?seven ba's val#ed at 46,5D)>>)

The arrastre operator sho#ld pay attorney+s ees to the

plaintif or not havin' satis8ed its plainly valid, 3#st and

de(andable clai( ;%rt) >>*5, &ivil &ode>, Rep#blic

%ct Ao) D6>, as the val#e

o the >C ba's o resin ;*> ba's (issin' and >D ba's

da(a'ed, !6> #p to the date o pay(ent,


67/78

4l#s 4,*** as attorney+s ees and liti'ation e/penses, and

the costs)

MARI#IM) AG)NCI)S ? S)R+IC)S, INC., petitioner,vs)

C$R# $ A)ALS, an% NI$N INSRANC) S$CI)#Y

$ CAN#$N, L#., respondents)

G.R. No. 6/ July 1', 1990

Transcontinental 0ertili.er &o(pany o -ondon chartered

ro( Hon'2on' 1sland Shippin' &o(pany o Hon'2on' the

(otor vessel na(ed "Hon'2on' 1sland" or the ship(ent o

5*CG)GD MT ;'ross< ba''ed #rea ro( Aovorossis2, Odessa,

9SSR to the 4hilippines, the parties si'nin' or this p#rpose a

9nior( eneral &harter dated %#'#st !, !C!) 1

O the total ship(ent, D,**)* MT was or the acco#nt o

%tlas 0ertili.er &o(pany as consi'nee, G,**)* to be

dischar'ed in Manila and the re(ainin' >,*** MT in &eb#) '

The 'oods were ins#red by the consi'nee with the 9nion

1ns#rance Society o &anton, -td) or 46,CC!,>)** a'ainst

all ris2s)

Mariti(e %'encies F Services, 1nc) was appointed as the

charterer+s a'ent and Macondray &o(pany, 1nc) as the

owner+s a'ent)/

The vessel arrived in Manila on October G, !C!, and

#nloaded part o the consi'nee+s 'oods, then proceeded to


68/78

&eb# on October !, !C!, to dischar'e the rest o the

car'o) On October G, !C!, the consi'nee 8led a or(al

clai( a'ainst Mariti(e, copy #rnished Macondray, or the

a(o#nt o 45C,6G)D, representin' & F 0 val#e o the ,G5G

shortlanded ba's) 5On Ian#ary >, !5*, the consi'nee 8ledanother or(al clai(, this ti(e a'ainst Biva sto(s

$ro2era'e, or the a(o#nt o 4G6,*G*)>G, representin' the

val#e o DC ba's o net #nrecovered spilla'e) 6

These clai(s havin' been re3ected, the consi'nee then went

to 9nion, which on de(and paid the total inde(nity o

4G,>G)56 p#rs#ant to the ins#rance contract) %s

s#bro'ee o the consi'nee, 9nion then 8led on Septe(ber!, !5*, a co(plaint or rei(b#rse(ent o this a(o#nt,

with le'al interest and attorney+s ees, a'ainst Hon'2on'

1sland &o(pany, -td), Mariti(e %'encies F Services, 1nc)

andLor Biva sto(s $ro2era'e) On %pril >*, !5, the

co(plaint was a(ended to drop Biva and i(plead

Macondray &o(pany, 1nc) as a new deendant) (

On Ian#ary , !5, ater trial, the trial co#rt rendered

3#d'(ent holdin' the deendants liable as ollows:

;a< deendants Hon'2on' 1sland &o), -td), and its local

a'ent Macondray F &o), 1nc) to pay the plaintif the s#(

o 45C,6G)D pl#s > interest ro( %pril >*, !5

#ntil the whole a(o#nt is #lly paid, 4,***)** as

attorney+s ees and to pay one?hal ;L>< o the costs=

and

;b< deendant Mariti(e %'encies F Services, 1nc), to

pay the plaintif the s#( o 4G6,*G*)>G, pl#s >

interest ro( %pril >*, !5 #ntil the whole a(o#nt is

#lly paid, 46**)** as attorney+s ees and to pay one?

hal ;L>< o the costs)9


69/78

4etitioner appealed the decision to the &o#rt o %ppeals,

which rendered a decision on Aove(ber >5, !56, the

dispositive portion o which reads:

HERE0ORE, the decision appealed ro( is (odi8ed,8ndin' the charterer Transcontinental 0ertili.er &o), -td)

represented by its a'ent Mariti(e %'encies F Services,

1nc) liable or the a(o#nt o 45C,6G)D pl#s interest at

> pl#s attorney+s ees o 4,***)**) eendant

Hon'2on' 1sland &o), -td) represented by Macondray

&o), 1nc) are accordin'ly e/e(pted ro( any liability) 10

Mariti(e and 9nion 8led separate (otions or

reconsideration which were both denied) The (ovants are

now beore #s to 7#estion the decision o the respondent

co#rt)

1n )R) Ao) CC6G5, Mariti(e pleads non?liability on the

'ro#nd that it was only the charterer+s a'ent and sho#ld not

answer or whatever responsibility (i'ht have attached to

the principal) 1t also ar'#es that the respondent co#rt erred

in applyin' %rticles CG and CGD o the &ivil &ode indeter(inin' the charterer+s liability)

1n )R) Ao) CC6C, 9nion as2s or the (odi8cation o the

decision o the respondent co#rt so as to (a2e Mariti(e

solidarily and solely liable, its principal not havin' been

i(pleaded and so not s#b3ect to the 3#risdiction o o#r

co#rts)

These two cases were consolidated and 'iven d#e co#rse,

the parties bein' re7#ired to s#b(it si(#ltaneo#s

(e(oranda) %ll co(plied, incl#din' Hon'2on' 1sland

&o(pany, -td), and Macondray &o(pany, 1nc), altho#'h they

pointed o#t that they were not involved in the petitions)


70/78

There are three 'eneral cate'ories o charters, to wit, the

de(ise or "bareboat charter," the ti(e charter and the

voya'e charter)

% de(ise involves the transer o #ll possession and controlo the vessel or the period covered by the contract, the

charterer obtainin' the ri'ht to #se the vessel and carry

whatever car'o it chooses, while (annin' and s#pplyin' the

ship as well) 11

% ti(e charter is a contract to #se a vessel or a partic#lar

period o ti(e, the charterer obtainin' the ri'ht to direct the

(ove(ents o the vessel d#rin' the charterin' period,

altho#'h the owner retains possession and control) 1'

% voya'e charter is a contract or the hire o a vessel or one

or a series o voya'es #s#ally or the p#rpose o transportin'

'oods or the charterer) The voya'e charter is a contract o

afrei'ht(ent and is considered a private carria'e) 13

Tested by those de8nitions, the a'ree(ent entered into in

the cases at bar sho#ld be considered) This brin's #s to thebasic 7#estion o who, in this 2ind o charter, shall be liable

or the car'o)

% voya'e charter bein' a private carria'e, the parties (ay

reely contract respectin' liability or da(a'e to the 'oods

and other (atters) The basic principle is that "the

responsibility or car'o loss alls on the one who a'reed to

peror( the d#ty involved" in accordance with the ter(s o

(ost voya'e charters) 1/

This is tr#e in the present cases where the charterer was

responsible or loadin', stowa'e and dischar'in' at the ports

visited, while the owner was responsible or the care o the


71/78

car'o d#rin' the voya'e) Th#s, 4ar) > o the 9nior( eneral

&harter read:

>) Owners are to be responsible or loss o or da(a'e to

the 'oods or or delay in delivery o the 'oods only incase the loss, da(a'e or delay has been ca#sed by the

i(proper or ne'li'ent stowa'e o the 'oods or by

personal want o d#e dili'ence on the part o the

Owners or their Mana'er to (a2e the vessel in all

respects seaworthy and to sec#re that she is properly

(anned, e7#ipped and s#pplied or by the personal act

or dea#lt o the Owners or their Mana'er)

%nd the Owners are responsible or no loss or da(a'e

or delay arisin' ro( any other ca#se whatsoever, even

ro( the ne'lect or dea#lt o the &aptain or crew or

so(e other person e(ployed by the Owners onboard or

ashore or whose acts they wo#ld, b#t or this cla#se,

be responsible, or ro( #nseaworthiness o the vessel

on loadin' or co((ence(ent o the voya'e or at any

ti(e whatsoever)

a(a'e ca#sed by contact with or lea2a'e, s(ell or

evaporation ro( other 'oods or by the ina((able or

e/plosive nat#re or ins#Jcient pac2a'e o other 'oods

not to be considered as ca#sed by i(proper or

ne'li'ent stowa'e, even i in act so ca#sed)

while &la#se C o %dditional &la#ses to &harter party

provided:

The car'o shall be loaded, stowed and dischar'ed ree

o e/pense to the vessel #nder the Master+s

s#pervision) However, i re7#ired at loadin' and

dischar'in' ports the vessel is to 'ive ree #se o

winches and power to drive the( 'ear, r#nners and


72/78

ropes) %lso slin's, as on board) Shore winch(en are to

be e(ployed and they are to be or &harterers+ or

Shippers+ or Receivers+ acco#nt as the case (ay be)

Bessel is also to 'ive ree #se o s#Jcient li'ht, as on

board, i re7#ired or ni'ht wor2) Ti(e lost thro#'hbrea2down o winches or derric2s is not to co#nt as

layti(e)

1n Home nsurance Co) v) American Steamship Agencies#

nc), 15the trial co#rt re3ected si(ilar stip#lations as contrary

to p#blic policy and, applyin' the provisions o the &ivil &ode

on co((on carriers and o the &ode o &o((erce on the

d#ties o the ship captain, held the vessel liable in da(a'esor loss o part o the car'o it was carryin') This &o#rt

reversed, declarin' as ollows:

The provisions o o#r &ivil &ode on co((on carriers

were ta2en ro( %n'lo?%(erican law) 9nder %(erican

3#rispr#dence, a co((on carrier #nderta2in' to carry a

special car'o or chartered to a special person only,

beco(es a private carrier) %s a private carrier, a

stip#lation e/e(ptin' the owner ro( liability or the

ne'li'ence o its a'ent is not a'ainst p#blic policy, and

is dee(ed valid)

S#ch doctrine we 8nd reasonable) The &ivil &ode

provisions on co((on carriers sho#ld not be applied

where the carrier is not actin' as s#ch b#t as a private

carrier) The stip#lation in the charter party absolvin'

the owner ro( liability or loss d#e to the ne'li'ence oits a'ent wo#ld be void only i the strict p#blic policy

'overnin' co((on carriers is applied) S#ch policy has

no orce where the p#blic at lar'e is not involved, as in

the case o a ship totally chartered or the #se o a

sin'le party)


73/78

Aevertheless, this r#lin' cannot bene8t Hon'2on', beca#se

there was no showin' in that case that the vessel was at

a#lt) 1n the cases at bar, the trial co#rt o#nd that ,G5G

ba's were shortlanded, which co#ld only (ean that they

were da(a'ed or lost on board the vessel beore #nloadin'o the ship(ent) 1t is not denied that the entire car'o

shipped by the charterer in Odessa was covered by a clean

bill o ladin') 16 %s the ba's were in 'ood order when

received in the vessel, the pres#(ption is that they were

da(a'ed or lost d#rin' the voya'e as a res#lt o their

ne'li'ent i(proper stowa'e) 0or this the ship owner sho#ld

be held liable)

$#t we do a'ree that the period or 8lin' the clai( is one

year, in accordance with the &arria'e o oods by Sea %ct)

This was adopted and e(bodied by o#r le'islat#re in &o()

%ct Ao) 6D which, as a special law, prevails over the 'eneral

provisions o the &ivil &ode on prescription o actions)

Section G;6< o that %ct provides as ollows:

1n any event, the carrier and the ship shall be

dischar'ed ro( all liability in respect o loss or da(a'e

#nless s#it is bro#'ht within one year ater delivery o

the 'oods or the date when the 'oods sho#ld have

been delivered= 4rovided, that i a notice o loss or

da(a'e= either apparent or concealed, is not 'iven as

provided or in this section, that act shall not efect or

pre3#dice the ri'ht o the shipper to brin' s#it within

one year ater the delivery o the 'oods or the date

when the 'oods sho#ld have been delivered)

This period was applied by the &o#rt in the case o ,nion

Car$ide# hilippines# nc) v) Manila +ailroad Co), 1where it

was held:


74/78

9nder the acts o this case, we held that the one?year

period was correctly rec2oned by the trial co#rt ro(

ece(ber !, !6, when, as a'reed #pon by the

parties and as shown in the tally sheets, the car'o was

dischar'ed ro( the carryin' vessel and delivered tothe Manila 4ort Service) That one?year period e/pired

on ece(ber !, !6>) 1nas(#ch as the action was

8led on ece(ber >, !6>, it was barred by the

stat#te o li(itations)

The one?year period in the cases at bar sho#ld co((ence on

October >*, !C!, when the last ite( was delivered to the

consi'nee)1(

9nion+s co(plaint was 8led a'ainst Hon'2on'on Septe(ber !, !5*, b#t tardily a'ainst Macondray on

%pril >*, !5) The conse7#ence is that the action is

considered prescribed as ar as Macondray is concerned b#t

not a'ainst its principal, which is what (atters anyway)

%s re'ards the 'oods da(a'ed or lost d#rin' #nloadin', the

charterer is liable thereor, havin' ass#(ed this activity

#nder the charter party "ree o e/pense to the vessel)" The

diJc#lty is that Transcontinental has not been i(pleaded in

these cases and so is beyond o#r 3#risdiction) The liability

i(posable #pon it cannot be borne by Mariti(e which, as a

(ere a'ent, is not answerable or in3#ry ca#sed by its

principal) 1t is a well?settled principle that the a'ent shall be

liable or the act or o(ission o the principal only i the latter

is #ndisclosed) 19

9nion see2s to hold Mariti(e liable as ship a'ent on thebasis o the r#lin' o this &o#rt in the case o S&it*erland

/eneral nsurance Co), )td) v) +amire*) '0However, we do

not 8nd that case is applicable)


75/78

1n that case, the charterer represented itsel on the ace o

the bill o ladin' as the carrier) The vessel owner and the

charterer did not stip#late in the &harter party on their

separate respective liabilities or the car'o) The lossLda(a'e

to the car'o was s#stained while it was still on board or#nder the c#stody o the vessel) %s the charterer was itsel

the carrier, it was (ade liable or the acts o the ship captain

who was responsible or the car'o while #nder the c#stody o

the vessel)

%s or the charterer+s a'ent, the evidence showed that it

represented the vessel when it too2 char'e o the #nloadin'

o the car'o and iss#ed car'o receipts ;or tally sheets< in itsown na(e) &lai(s a'ainst the vessel or the lossesLda(a'es

s#stained by that car'o were also received and processed by

it) %s a res#lt, the charterer+s a'ent was also considered a

ship a'ent and so was held to be solidarily liable with its

principal)

The acts in the cases at bar are diferent) The charterer did

not represent itsel as a carrier and indeed ass#(ed

responsibility ability only or the #nloadin' o the car'o, i)e,

ater the 'oods were already o#tside the c#stody o the

vessel) 1n s#pervisin' the #nloadin' o the car'o and iss#in'

aily Operations Report and State(ent o 0acts indicatin'

and describin' the day?to?day dischar'e o the car'o,

Mariti(e acted in representation o the charterer and not o

the vessel) 1t th#s cannot be considered a ship a'ent) %s a

(ere charterer+s a'ent, it cannot be held solidarily liable

with Transcontinental or the lossesLda(a'es to the car'oo#tside the c#stody o the vessel) Aotably, Transcontinental

was disclosed as the charterer+s principal and there is no

7#estion that Mariti(e acted within the scope o its

a#thority)


76/78

Hon'2on' and Macondray point o#t in their (e(orand#(

that the appealed decision is not assailed insoar as it avors

the( and so has beco(e 8nal as to the() e do not thin2

so) 0irst o all, we note that they were or(ally i(pleaded as

respondents in )R Ao) CC6C and s#b(itted their co((entand later their (e(orand#(, where they disc#ssed at

len'th their position vis:a:visthe clai(s o the other parties)

Secondly, we reiterate the r#le that even i iss#es are not

or(ally and speci8cally raised on appeal, they (ay

nevertheless be considered in the interest o 3#stice or a

proper decision o the case)iRtRc:asl Th#s, we have held

that:

$esides, an #nassi'ned error closely related to the error

properly assi'ned, or #pon which the deter(ination o

the 7#estion raised by the error properly assi'ned is

dependent, will be considered by the appellate co#rt

notwithstandin' the ail#re to assi'n it as error)

%t any rate, the &o#rt is clothed with a(ple a#thority to

review (atters, even i they are not assi'ned as errors

in their appeal, i it 8nds that their consideration is

necessary in arrivin' at a 3#st decision o the case) '1

/// /// ///

1ss#es, tho#'h not speci8cally raised in the pleadin's in

the appellate co#rt, (ay, in the interest o 3#stice, be

properly considered by said co#rt in decidin' a case, i

they are 7#estions raised in the trial co#rt and are(atters o record havin' so(e bearin' on the iss#e

s#b(itted which the parties ailed to raise or the lower

co#rt i'nore;d


77/78

hile an assi'n(ent o error which is re7#ired by law or

r#le o co#rt has been held essential to appellate

review, and only those assi'ned will be considered,

there are a n#(ber o cases which appear to accord to

the appellate co#rt a broad discretionary power towaive this lac2 o proper assi'n(ent o errors and

consider errors not assi'ned) '3

1n his decision dated Ian#ary , !5, I#d'e %rte(on de

-#na o the Re'ional Trial &o#rt o Manila held:

The &o#rt, on the basis o the evidence, 8nds nothin' to

disprove the 8ndin' o the (arine and car'o s#rveyors

that o the 66,G!* ba's o #rea ertili.er, 6D,DC ba's

were "dischar'ed e/?vessel" and there were

"shortlanded" ",G5G ba's", val#ed at 45C,6G)D) This

s#( sho#ld be the principal and pri(ary liability and

responsibility o the carryin' vessel) 9nder the contract

or the transportation o 'oods, the vessel+s

responsibility co((ence #pon the act#al delivery to,

and receipt by the carrier or its a#thori.ed a'ent, #ntil

its 8nal dischar'e at the port o Manila) eendant

Hon'2on' 1sland &o), -td), as "shipowner" and

represented by the deendant Macondray F &o), 1nc), as

its local a'ent in the 4hilippines, sho#ld be responsible

or the val#e o the ba's o #rea ertili.er which were

shortlanded)

The re(ainder o the clai( in the a(o#nt o

4G6,*G*)>G, representin' the val#e o the DC ba's o#nrecovered spilla'es havin' occ#rred ater the

ship(ent was dischar'ed ro( the vessel #nto the e/?

li'hters as well as d#rin' the dischar'e ro( the

li'hters to the tr#c2 which transported the ship(ent to


78/78

the consi'nee+s wareho#ses sho#ld be or the acco#nt

o the deendant Mariti(e %'encies F Services, 1nc)

e aJr( the act#al 8ndin's b#t (#st (odiy the le'al

concl#sions) %s previo#sly disc#ssed, the liability oMacondray can no lon'er be enorced beca#se the clai(

a'ainst it has prescribed= and as or Mariti(e, it cannot be

held liable or the acts o its 2nown principal res#ltin' in

in3#ry to 9nion) The interest (#st also be red#ced to the

le'al rate o 6, conor(ably to o#r r#lin' in +e"ormina v)

Tomol '/ and %rticle >>*! o the &ivil &ode, and sho#ld

co((ence, not on %pril >*, !5, b#t on Septe(ber !,

!5*, date o the 8lin' o the ori'inal co(plaint)

HERE0ORE, the decision o the respondent co#rt is SET

%S1E and that o the trial co#rt is RE1AST%TE as above

modified. The parties shall bear their respective costs.

transpo case

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