ASIAN TERMINALS, INC. vs. PHILAM INSURANCE CO.
, INC simply upon payment by the insurance company of the insurance
G.R. Nos. 181163, 181262, and 181319, July 24, 2013 (VILLARAMA, JR.,
J)
FACTS:
On April 15, 1995, Nichimen Corporation shipped to Universal Motors
Corporation 219 packages containing 120 units of brand new Nissan
Pickup Truck Double Cab 42 model, without engine, tires and
batteries, on board the vessel S/S Calayan Iris from Japan to Manila.
The shipment, which had a declared value of US$81,368 or
P29,400,000, was insured with Philam against all risks under the
marine Policy no. 708-8006717-4.
The carrying vessel arrived at the port of manila on April 20, 1995, and
when the shipment was unloaded by the staff of ATI, it was found that
the package marked as 03-245-42K/1 was in bad order. The Turn Over
Survey of bad order cargoes dated April 21, 1995 identified two
packages, labelled 03-245-42K/1 and 03/237/7CK/2, as being dented
and broken. Thereafter, the cargoes were stored for temporary
safekeeping inside CFS Warehouse in Pier No. 5.
On May 11, 1995, the shipment was withdrawn by R.F. Revilla Customs
Brokerage, Inc., the authorized broker of Universal Motors, and
delivered to the latters warehouse in Mandaluyong City. Upon the
request of Universal Motors, a bad order survey was conducted on the
cargoes and it was found that one Frame Axle Sub without LWR was
deeply dented on the buffle plate while six Frame Assembly with Bush
were deformed and misaligned. Owing to the extent of the damage to
said cargoes, Universal Motors declared them a total loss.
On August 4, 1995, Universal Motors filed a formal claim for damages
in the amount of P643,963.84 against Westwind, ATI and R.F. Revilla
Customs Brokerage, Inc. When Universal Motors demands remained
unheeded, it sought reparation from and was compensated in the sum
of P633,957.15 by Philam. Accordingly, Universal Motors issued a
Subrogation Receipt dated November 15, 1995 in favor of Philam.
On January 18, 1996, Philam, as subrogee of Universal Motors, filed a
Complaint for damages against Westwind, ATI and R.F. Revilla Customs
Brokerage, Inc. before the Regional Trial Court of Makati City. The trial
court rendered judgment in favour of Philam which ruling was affirmed
by the Court of Appeals modifying the amount to be paid by Westwind
and ATI.
ISSUE:
Whether or not Philam may claim against Westwind and ATI as a
subrogee
HELD:
YES. The Court holds that petitioner Philam has adequately established
the basis of its claim against petitioners ATI and Westwind. Philam, as
insurer, was subrogated to the rights of the consignee, Universal
Motors Corporation, pursuant to the Subrogation receipt executed by
the latter in favour of the former. The right of subrogation accrues
claim.
Petitioner Philams action finds support in Article 2207 of the Civil
Code which provides that if the plaintiffs property has been insured,
and he has received indemnity from the insurance company for the
injury or loss arising out of the wrong or breach of contract
complained of, the insurance company shall be subrogated to the
rights of the insured against the wrongdoer or the person who has
violated the contract.
In Malayan Insurance Co., Inc. vs. Alberto, the Court explained the
effect of payment by the insurer of the insurance claim in this wise:
We have held that payment by the insurer to the insured operates as
an equitable assignment to the insurer of all the remedies that the
insured may have against the third party whose negligence or wrongful
act caused the loss. The right of subrogation is not dependent upon,
nor does it grow out of, any privity of contract. It accrues simply upon
payment by the insurance company of the insurance claim. The
doctrine of subrogation has its roots in equity. It is designed to
promote and accomplish justice; and is the mode that equity adopts to
compel the ultimate payment of a debt by one who, in justice, equity,
and good conscience, ought to pay
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WESTWIND SHIPPING CORPORATION v.
UCPB GENERAL INSURANCE CO., INC. and ASIAN TERMINALS INC
ORIENT FREIGHT INTERNATIONAL INC. v.
UCPB GENERAL INSURANCE CO., INC. and ASIAN TERMINALS INC.
G.R. No. 200314, G.R. No. 200289, November 25, 2013 THIRD
DIVISION PERALTA, J.
Common carriers, from the nature of their business and for reasons of
public policy, are bound to observe extraordinary diligence in vigilance
over the goods and for the safety of the passengers transported by
them, according to all the circumstances of each case.
FACTS: Kinsho-Mataichi Corporation shipped from the
port of Kobe, Japan, 197 metal containers/skids of tin-free steel for
delivery to the consignee, San Miguel Corporation The shipment was
loaded and received clean on board M/V Golden Harvest Voyage No.
66, a vessel owned and operated by Westwind Shipping Corporation.
SMC insured the cargoes against all risks with UCPB General Insurance
Co., Inc.
The shipment arrived in Manila and was discharged in the custody of
the arrastre operator, Asian Terminals, Inc. During the unloading
operation six containers/skids sustained dents and punctures from the
forklift used by the stevedores of Ocean Terminal Services, Inc. in
centering and shuttling the containers/skids. Orient Freight
International, Inc., the customs broker of SMC, withdrew from ATI the
197 containers/skids and delivered the same at SMCs warehouse. It
was discovered upon discharge that additional nine containers/skids
were also damaged due to the forklift operations; thus, making the
total number of 15 containers/skids in bad order.
SMC filed complaints. The RTC opined that Westwind is not liable,
since the discharging of the cargoes were done by ATI personnel using
forklifts. It likewise absolved OFII from any liability, reasoning that it
never undertook the operation of the forklifts which caused the dents
and punctures, and that it merely facilitated the release and delivery of
the shipment as the customs broker and representative of SMC. On
appeal by UCPB, the CA reversed and set aside the trial court. It
concluded that the common carrier, not the arrastre operator, is
responsible during the unloading of the cargoes and is still bound to
exercise extraordinary diligence at the time. The CA also considered
that OFII is liable, agreeing with UCPBs contention that OFII is a
Page 1 of 6
common carrier bound to observe extraordinary diligence and is
presumed to be at fault or have acted negligently for such damage.
ISSUE: Whether Westwind and OFII are liable to exercise extraordinary
diligence
RULING: YES. 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 transported by them. The
extraordinary responsibility of the common carrier lasts from the time
the goods are unconditionally placed in the possession of, and received
by the carrier for transportation until the same are delivered, actually
or constructively, by the carrier to the consignee, or to the person who
has a right to receive them.
In this case, since the discharging of the containers/skids, which were
covered by only one bill of lading, had not yet been completed at the
time the damage occurred, there is no reason to imply that there was
already delivery, actual or constructive, of the cargoes to ATI.
The mere proof of delivery of goods in good order to the carrier, and
their arrival in the place of destination in bad order, make out a prima
facie case against the carrier, so that if no explanation is given as to
how the injury occurred, the carrier must be held responsible. It is
incumbent upon the carrier to prove that the loss was due to accident
or some other circumstances inconsistent with its liability.18
The contention of OFII is likewise untenable. A customs broker has
been regarded as a common carrier because transportation of goods is
an integral part of its business. Article 1732 does not distinguish
between one whose principal business activity is the carrying of goods
and one who does such carrying only as an ancillary activity. The
contention, therefore, of petitioner that it is not a common carrier but
a customs broker whose principal function is to prepare the correct
customs declaration and proper shipping documents as required by
law is bereft of merit. It suffices that petitioner undertakes to deliver
the goods for pecuniary consideration. As the transportation of goods
is an integral part of a customs broker, the customs broker is also a
common carrier. For to declare otherwise "would be to deprive those
with whom [it] contracts the protection which the law affords them
notwithstanding the fact that the obligation to carry goods for [its]
customers, is part and parcel of petitioners business."21
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INSURANCE COMPANY OF NORTH AMERICA VS. ASIAN TERMINALS
INC.
G.R. No. 180784 February 15, 2012
Doctrine: The term carriage of goods in the Carriage of Goods by Sea
Act (COGSA) covers the period from the time the goods are loaded to
the vessel to the time they are discharged therefrom.
The carrier and the ship may put up the defense of prescription if the
action for damages is not brought within one year after the delivery of
the goods or the date when the goods should have been delivered. It
has been held that not only the shipper, but also the consignee or legal
holder of the bill may invoke the prescriptive period. However, the
COGSA does not mention that an arrastre operator may invoke the
prescriptive period of one year; hence, it does not cover the arrastre
operator.
Facts:
The trial court dismissed petitioners complaint for actual damages on
the ground of prescription under the Carriage of Goods by Sea Act.
Thus, an action was instituted to review the RTCs decision.
Page 2 of 6
On November 2002, Macro-Lite Corporation shipped to San Miguel
Corporation (SMC), through M/V DIMI P vessel, 185 packages (or
231,000 sheets) of electrolytic tin free steel, complete and in good
order condition and covered by Bill of Lading. The shipment had a
declared value of US $169,850.35 and was insured with petitioner
against all risks under its marine policy.
The carrying vessel arrived at the port of Manila and when the
shipment was discharged therefrom, it was noted than 7 packages
were damaged and in bad order. The shipment was then turned over
to the custody of respondent (as arrastre operator) for storage and
safekeeping pending its withdrawal by the consignees authorized
customs broker, which was later withdrawn by the customs broker
from custody of the respondent.
An examination report was written and showed that an additional 5
packages were found to be damaged and in bad order.
Consignee, SMC, filed separate claims against respondent and
petitioner for the damage of 11,200 sheets of electrolytic tin free steel.
Petitioner, as insurer of the cargo, paid the consignee the amount of
Php 431,592.14 for the damage caused to the shipment. Thereafter,
petitioner formally demanded reparation against respondent and as
respondent failed to satisfy its demand, petitioner filed an action for
damages with the RTC.
The trial court dismissed the complaint because it was already barred
by the statute of limitations. It held that COGSA, embodied in CA 65,
applies to this case since the goods were shipped from a foreign port
to the Philippines. Under the said law, particularly paragraph 4,
Section 3(6), the shipper has the right to bring a suit within one year
after the delivery of the goods or the date when the goods should have
been delivered.
Petitioners motion for recon was denied by the trial court. It submits
that the trial courts dismissal of the complaint on the ground of
prescription under the COGSA is legally erroneous. It contends that the
one-year limitation period for bringing a suit in court under the COGSA
is not applicable to this case. Petitioner asserts that since the
complaint was filed against respondent arrastre operator only, without
impleading the carrier, the prescriptive period under the COGSA is not
applicable to this case.
Moreover, petitioner contends that the term carriage of goods in the
COGSA covers the period from the time the goods are loaded to the
vessel to the time they are discharged therefrom. It points out that it
sued respondent only for the additional five (5) packages of the
subject shipment that were found damaged while in respondents
custody, long after the shipment was discharged from the vessel.
Issues:
(1) WON the one-year prescriptive period for filing a suit under
the COGSA applies to this action for damages against respondent
arrastre operator;
(2) WON petitioner is entitled to recover actual damages in the
amount of P431,592.14 from respondent.
Ruling:
(1) NO. The COGSA was accepted to be made applicable to all
contracts for the carriage of goods by sea to and from the Philippine
ports in foreign trade by virtue of CA 65. The term carriage of goods
covers the period from the time when the goods are loaded to the
time when they are discharged from the ship; thus, it can be inferred
that the period of time when the goods have been discharged from the
ship and given to the custody of the arrastre operator is not covered by
the COGSA.
The prescriptive period for filing an action for the loss or damage of
the goods under the COGSA is found in paragraph 6, Section 3. It
states that in any event, the carrier and the ship shall be discharged
from all liability in respect of loss or damage unless suit is brought
within one year after delivery of the goods or the date when the goods
should have been delivered. Provided, that if a notice of loss or
damage, either apparent or concealed, is not given as provided for in
this section, that fact shall not affect or prejudice the right of the
shipper to bring suit within one year after the delivery of the goods or
the date when the goods should have been delivered.
However, the COGSA does not mention that an arrastre operator may
invoke the prescriptive period of 1 year; hence, it does not cover the
arrastre operator.
In fact, respondent arrastre operators responsibility and liability for
losses and damages are set forth in Section 7.01 of the Contract for
Cargo Handling Services executed between the Philippine Ports
Authority and Marina Ports Services, Inc. (now Asian Terminals, Inc.),
which explicitly provides that the consignee has a period of thirty (30)
days from the date of delivery of the package to the consignee within
which to request a certificate of loss from the arrastre operator. From
the date of the request for a certificate of loss, the arrastre operator
has a period of fifteen (15) days within which to issue a certificate of
non-delivery/loss either actually or constructively. Moreover, from the
date of issuance of a certificate of non-delivery/loss, the consignee has
fifteen (15) days within which to file a formal claim covering the loss,
injury, damage or non-delivery of such goods with all accompanying
documentation against the arrastre operator.
Here, the verification and ascertainment of liability by respondent ATI
had been accomplished within thirty (30) days from the date of
delivery of the package to the consignee and within fifteen (15) days
from the date of issuance by the Contractor (respondent ATI) of the
examination report on the request for bad order survey. Although the
formal claim was filed beyond the 15-day period from the issuance of
the examination report on the request for bad order survey, the
purpose of the time limitations for the filing of claims had already
been fully satisfied by the request of the consignees broker for a bad
order survey and by the examination report of the arrastre operator on
the result thereof, as the arrastre operator had become aware of and
had verified the facts giving rise to its liability. Hence, the arrastre
operator suffered no prejudice by the lack of strict compliance with
the 15-day limitation to file the formal complaint.
(2) YES. Petitioner is entitled to actual damages in the amount of
P164,428.76 for the four (4) skids damaged while in the custody of
respondent.
It should be noted that the petitioner, who filed this action for
damages for the five (5) skids that were damaged while in the custody
of respondent, was not forthright in its claim, as it knew that the
damages it sought in the amount of P431,592.14, which was based on
the Evaluation Report of its adjuster/surveyor covered nine (9) skids.
Based on the same Evaluation Report, only four of the nine skids were
damaged in the custody of respondent. Petitioner should have been
straightforward about its exact claim, which is borne out by the
evidence on record, as petitioner can be granted only the amount of
damages that is due to it.
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G.R. No. 171337 July 11, 2012
BENJAMIN CUA (CUA UlAN TEK), Petitioner, vs. WALLEM PHILIPPINES
SHIPPING, INC. and ADVANCE SHIPPING CORPORATION, Respondents.
FACTS: Cua filed a civil case for damages aganst Wallem Inc and
Advance Shipping Corp for the payment of damage to 218 tons and for
a shortage of 50 tons of shipment of brazilian soybean. He claimed
that the loss was due to the respondents' failure to observe
extraordinary diligence in carrying the cargo. Advance Shipping was a
foreign corporation that was the owner and manager of MV Argo
Trader that carried the cargo while Wallem was its local agent.
Wallem filed a motion to dismiss raising the ground of presecription
under Section 3(6) of the COGSA which provides that "the carrier and
the ship shall be discharged from all liability in respect of loss or
damage unless suit is brought within one year after delivery of the
goods."
ISSUE: Whether or not prescription has set in
HELD: NO. The COGSA is the applicable law for all contracts for carriage
of goods by sea to and from Philippine ports in foreign trade; it is thus
the law that the Court shall consider in the present case since the
cargo was transported from Brazil to the Philippines. Under Section
3(6) of the COGSA, the carrier is discharged from liability for loss or
damage to the cargo "unless the suit is brought within one year after
delivery of the goods or the date when the goods should have been
delivered." Jurisprudence, however, recognized the validity of an
agreement between the carrier and the shipper/consignee extending
the one-year period to file a claim.
The vessel MV Argo Trader arrived in Manila on July 8, 1989; Cuas
complaint for damages was filed before the RTC of Manila on
November 12, 1990. Although the complaint was clearly filed beyond
the one-year period, Cua additionally alleged in his complaint (under
paragraph 11) that
"the defendants x x x agreed to extend the time for filing of the action
up to November 12, 1990."
The allegation of an agreement extending the period to file an action
in Cuas complaint is a material averment that, under Section 11, Rule
8 of the Rules of Court, must be specifically denied by the
respondents; otherwise, the allegation is deemed admitted.
A review of the pleadings submitted by the respondents discloses that
they failed to specifically deny Cuas allegation of an agreement
extending the period to file an action to November 12, 1990. Wallems
motion to dismiss simply referred to the fact that Cuas complaint was
filed more than one year from the arrival of the vessel, but it did not
contain a denial of the extension. This presumed admission is further
bolstered by the express admission made by the respondents
themselves in their Memorandum:
STATEMENT OF THE CASE
1. This case was filed by [the] plaintiff on 11 November 1990 within the
extended period agreed upon by the parties to file suit.
The above statement is a clear admission by the respondents that
there was indeed an agreement to extend the period to file the claim.
Thus, Cua timely filed a claim for the damage to and shortage of the
cargo.
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MALAYAN INSURANCE vs PHILIPPINE FIRST INSURANCE
FACTS
Wyeth contracted a contract of carriage with Republic, a
common carrier for the transport of its goods and product.
Wyeth insured the goods with Philippine First , while
Republic insured the same goods with Malayan insurance
During transit, certain goods were lost due to hijacking of 10
armed men.
Philippine first paid the proceeds to Wyeth, subrogating the
rights of wyeth to Philippine first which filed a claim against Republic
and Malayan as a 3rd party defendant.
Republic and Malayan refused the claim of Philippine first.
Malayan contended that there was double insurance and that the first
insurer, Philippine First, should bear all the loss.
ISSUE
W/N Malayan is liable? - YES
Page 3 of 6
 W/N there is double insurance? - NO
W/N Malayan is solidarily liable with Republic? - NO
HELD
Malayan is liable because of the insurance contract it
executed with Republic for the idemnity for the loss. The cause of the
loss not within the purview of an excepted peril, having been
determined in the lower courts is conclusive upon the SC making
Malayan liable for the idemnity.
There is double insurance when:
1] The person insured is the same
2] 2 or more insurers insuring separately
3] There is identity of subject matter
4] There is identity of interest insured
5] There is identity of the risk or peril insured against
In the case at bar though the 2 insurance policy, one by Philippine first
and one by Malayan were issued over the same subject matter
covering the same peril, it was issued to 2 different persons and to 2
different interest.
Philippine first insured wyeth over its own goods
Malayan insured republic over the latters insurable interest
over the safety of the goods which could become the basis for liability
in case of loss or damage.
Malayan is not solidarily liable with Republic because they have
different sources from which their liability arose. Republic arose due to
a contract of carriage, while Malayan is that of contract. Solidarity exist
only by express stipulation of the parties or those provided by law,
none of which is applicable in the present case.
---------------------xxx---------------------
LOADMASTER CUSTOMS SERVICES VS. GLODEL
G.R. No. 179446, Jan. 10, 2011, Mendoza, J.:p, 2nd Division
FACTS: R&B Insurance insured the shipment of 132 bundles of electric
copper cathodes against All Risks for Columbia, the owner of the
cargoes. The cargoes were shipped on board the vessel "Richard Rey"
from Isabela, Leyte, to Pier 10, North Harbor, Manila. They arrived on
the same date.Columbia engaged the services of Glodel for the release
and withdrawal of the cargoes from the pier and the subsequent
delivery to its warehouses/plants. Glodel, in turn, engaged the services
of Loadmasters for the use of its delivery trucks to transport the
cargoes to Columbias warehouses/plants in Bulacan and Valenzuela
City.One (1) truck, loaded with 11 bundles or 232 pieces of copper
cathodes, failed to deliver its cargo.Later on, the said truck was
recovered but without the copper cathodes. Because of this incident,
Columbia filed with R&B Insurance a claim for insurance indemnity in
the amount ofP1,903,335.39. R&B Insurance paid Columbia the
amount ofP1,896,789.62 as insurance indemnity and thereafter, filed a
complaint for damages against both Loadmasters and Glodelbefore the
Regional Trial Court. It sought reimbursement of the amount it had
paid to Columbia for the loss of the subject cargo. It claimed that it had
been subrogated "to the right of the consignee to recover from the
party/parties who may be held legally liable for the loss."The RTC
rendered a decision holding Glodel liable for damages for the loss of
the subject cargo and dismissing Loadmasters counterclaim for
damages and attorneys fees against R&B Insurance.On appeal, the CA
likewise held Glodel liable and also Loadmaster.
ISSUE: W/N Loadmaster is also liable for the loss.
Page 4 of 6
HELD:Yes.To totally exculpate itself from responsibility for the lost
goods, Loadmasters argues that it cannot be considered an agent of
Glodel because it never represented the latter in its dealings with the
consignee. At any rate, it further contends that Glodel has no recourse
against it for its (Glodels) failure to file a cross-claim. Glodel, in its
Comment, counters that Loadmasters is liable to it under its cross-
claim because the latter was grossly negligent in the transportation of
the subject cargo. Finally, Glodel argues that its relationship with
Loadmasters is that of Charter wherein the transporter (Loadmasters)
is only hired for the specific job of delivering the merchandise. Thus,
the diligence required in this case is merely ordinary diligence or that
of a good father of the family, not the extraordinary diligence required
of common carriers.At the outset, it is well to resolve the issue of
whether Loadmasters and Glodel are common carriers to determine
their liability for the loss of the subject cargo. Under Article 1732 of
the Civil Code, common carriers are persons, corporations, firms, or
associations engaged in the business of carrying or transporting
passenger or goods, or both by land, water or air for compensation,
offering their services to the public.Based on the definition,
Loadmasters is a common carrier because it is engaged in the business
of transporting goods by land, through its trucking service. It is a
common carrier as distinguished from a private carrier wherein the
carriage is generally undertaken by special agreement and it does not
hold itself out to carry goods for the general public.The distinction is
significant in the sense that "the rights and obligations of the parties to
a contract of private carriage are governed principally by their
stipulations, not by the law on common carriers."
In the same vein, Glodel is also considered a common carrier within
the context of Article 1732. In its Memorandum, it states that it "is a
corporation duly organized and existing under the laws of the Republic
of the Philippines and is engaged in the business of customs
brokering." It cannot be considered otherwise because as held by this
Court in Schmitz Transport & Brokerage Corporation v. Transport
Venture, Inc.,14 a customs broker is also regarded as a common
carrier, the transportation of goods being an integral part of its
business.Loadmasters and Glodel, being both common carriers, are
mandated from the nature of their business and for reasons of public
policy, to observe the extraordinary diligence in the vigilance over the
goods transported by them according to all the circumstances of such
case, as required by Article 1733 of the Civil Code.With respect to the
time frame of this extraordinary responsibility, the Civil Code provides
that the exercise of extraordinary diligence lasts from the time the
goods are unconditionally placed in the possession of, and received by,
the carrier for transportation until the same are delivered, actually or
constructively, by the carrier to the consignee, or to the person who
has a right to receive them.
Premises considered, the Court is of the view that both Loadmasters
and Glodel are jointly and severally liable to R & B Insurance for the
loss of the subject cargo. Under Article 2194 of the New Civil Code,
"the responsibility of two or more persons who are liable for a quasi-
delict is solidary."
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NEW WORLD INTERNATIONAL VS. NYK-FILJAPAN SHIPPING CORP.
G.R. No. 171468, Aug. 24, 2011, Abad, J.:p, 3rd Division
FACTS: Petitioner New World International Development (Phils.), Inc.
(New World) bought from DMT Corporation (DMT) through its agent,
Advatech Industries, Inc. (Advatech) three emergency generator sets
worth US$721,500.00.DMT shipped the generator sets by truck from
Wisconsin, United States, to LEP Profit International, Inc. (LEP Profit) in
Chicago, Illinois. From there, the shipment went by train to Oakland,
California, where it was loaded on S/S California Luna V59, owned and
operated by NYK Fil-Japan Shipping Corporation (NYK) for delivery to
petitioner New World in Manila. NYK issued a bill of lading, declaring
that it received the goods in good condition.NYK unloaded the
shipment in Hong Kong and transshipped it to S/S ACX Ruby V/72 that
it also owned and operated. On its journey to Manila, however, ACX
Ruby encountered typhoon Kadiang whose captain filed a sea protest
on arrival at the Manila South Harbor respecting the loss and damage
that the goods on board his vessel suffered.
Marina Port Services, Inc. (Marina), the Manila South Harborarrastre
or cargo-handling operator, received the shipment and upon
inspection of the three container vans separately carrying the
generator sets, two vans bore signs of external damage while the third
van appeared unscathed. An examination of the three generator sets
in the presence of petitioner New Worlds representatives, Federal
Builders (the project contractor) and surveyors of petitioner New
Worlds insurer, SeaboardEastern Insurance Company (Seaboard),
revealed that all three sets suffered extensive damage and could no
longer be repaired. For these reasons, New World demanded
recompense for its loss from respondents NYK, DMT, Advatech, LEP
Profit, LEP International Philippines, Inc. (LEP), Marina, and Serbros.
While LEP and NYK acknowledged receipt of the demand, both denied
liability for the loss. Since Seaboard covered the goods with a marine
insurance policy, petitioner New World sent it a formal claim. Seaboard
required petitioner New World to submit to it an itemized list of the
damaged units, parts, and accessories, with corresponding values, for
the processing of the claim. But petitioner New World did not submit
what was required of it, insisting that the insurance policy did not
include the submission of such a list in connection with an insurance
claim. Reacting to this, Seaboard refused to process the claim.
Thus,petitioner New World filed an action for specific performance
and damages against all the respondents before the Regional Trial
Court (RTC) of Makati City. The RTC rendered a decision absolving the
various respondents from liability with the exception of NYK. The RTC
found that the generator sets were damaged during transit while in
the care of NYKs vessel, ACX Ruby.The RTC ruled, however, that
petitioner New World filed its claim against the vessel owner NYK
beyond the one year provided under the Carriage of Goods by Sea Act
(COGSA).On appeal, the Court of Appeals (CA) rendered judgment
affirming the RTCs rulings except with respect to Seaboards liability.
The CA rendered an amended decision, reversing itself as regards the
claim against Seaboard.
Petitioner New World asserts that the roles of respondents DMT,
Advatech, LEP, LEP Profit, Marina and Serbros in handling and
transporting its shipment from Wisconsin to Manila collectively
resulted in the damage to the same, rendering such
respondentssolidarily liable with NYK, the vessel owner.
ISSUE: W/N the carrier, NYK, is liable for the damage.
HELD: Yes.Consequently, the Court will not disturb the finding of the
RTC, affirmed by the CA, that the generator sets were totally damaged
during the typhoon which beset the vessels voyage from Hong Kong to
Manila and that it was her negligence in continuing with that journey
despite the adverse condition which caused petitioner New Worlds
loss.That the loss was occasioned by a typhoon, an exempting cause
under Article 1734 of the Civil Code, does not automatically relieve the
common carrier of liability. The latter had the burden of proving that
the typhoon was the proximate and only cause of loss and that it
exercised due diligence to prevent or minimize such loss before,
during, and after the disastrous typhoon. As found by the RTC and the
CA, NYK failed to discharge this burden.
-----------------------xxx----------------------
LHUILLER VS. BRITISH AIRWAYS
G.R. No. 171092, Mar. 15, 2010, Del Castillo, J.:p, 2nd Division
FACTS: Petitioner Edna DiagoLhuillier filed a Complaint for damages
against respondent British Airways before the Regional Trial Court
(RTC) of Makati City. She alleged that she took respondents flight 548
from London, United Kingdom to Rome, Italy. Once on board, she
allegedly requested Julian Halliday (Halliday), one of the respondents
flight attendants, to assist her in placing her hand-carried luggage in
the overhead bin. However, Halliday allegedly refused to help and
assist her, and even sarcastically remarked that "If I were to help all
300 passengers in this flight, I would have a broken back!"Petitioner
further alleged that when the plane was about to land in Rome, Italy,
another flight attendant, Nickolas Kerrigan (Kerrigan), singled her out
from among all the passengers in the business class section to lecture
on plane safety. Allegedly, Kerrigan made her appear to the other
passengers to be ignorant, uneducated, stupid, and in need of
lecturing on the safety rules and regulations of the plane. Affronted,
petitioner assured Kerrigan that she knew the planes safety
regulations being a frequent traveler. Thereupon, Kerrigan allegedly
thrust his face a mere few centimeters away from that of the
petitioner and menacingly told her that "We dont like your
attitude."Upon arrival in Rome, petitioner complained to respondents
ground manager and demanded an apology. However, the latter
declared that the flight stewards were "only doing their job."
Respondent, by way of special appearance through counsel, filed a
Motion to Dismiss on grounds of lack of jurisdiction over the case and
over the person of the respondent. Respondent alleged that only the
courts of London, United Kingdom or Rome, Italy, have jurisdiction
over the complaint for damages pursuant to the Warsaw Convention,
Article 28(1). The RTC of Makati City, Branch 132, issued an Order
granting respondents Motion to Dismiss.Petitioner now comes directly
before us on a Petition for Review on Certiorari on pure questions of
law, arguing that her cause of action arose not from the contract of
carriage, but from the tortious conduct committed by airline personnel
of respondent in violation of the provisions of the Civil Code on Human
Relations. Since her cause of action was not predicated on the contract
of carriage, petitioner asserts that she has the option to pursue this
case in this jurisdiction pursuant to Philippine laws.In contrast,
respondent maintains that petitioners claim for damages fell within
the ambit of Article 28(1) of the Warsaw Convention. As such, the
same can only be filed before the courts of London, United Kingdom or
Rome, Italy.
ISSUE: W/N the RTC has jurisdiction of the case.
HELD: No.The Warsaw Convention has the force and effect of law in
this country.The Warsaw Convention applies because the air travel,
where the alleged tortious conduct occurred, was between the United
Kingdom and Italy, which are both signatories to the Warsaw
Convention. Under Article 28(1) of the Warsaw Convention, the
plaintiff may bring the action for damages before
1. the court where the carrier is domiciled;
2. the court where the carrier has its principal place of business;
3. the court where the carrier has an establishment by which the
contract has been made; or
4. the court of the place of destination.
In this case, it is not disputed that respondent is a British corporation
domiciled in London, United Kingdom with London as its principal
place of business. Hence, under the first and second jurisdictional
rules, the petitioner may bring her case before the courts of London in
the United Kingdom. In the passenger ticket and baggage check
presented by both the petitioner and respondent, it appears that the
ticket was issued in Rome, Italy. Consequently, under the third
jurisdictional rule, the petitioner has the option to bring her case
before the courts of Rome in Italy. Finally, both the petitioner and
respondent aver that the place of destination is Rome, Italy, which is
properly designated given the routing presented in the said passenger
ticket and baggage check. Accordingly, petitioner may bring her action
before the courts of Rome, Italy. We thus find that the RTC of Makati
correctly ruled that it does not have jurisdiction over the case filed by
the petitioner.
A number of reasons tends to support the characterization of Article
28(1) as a jurisdiction and not a venue provision. First, the wording of
Article 32, which indicates the places where the action for damages
"must" be brought, underscores the mandatory nature of Article 28(1).
Second, this characterization is consistent with one of the objectives of
the Convention, which is to "regulate in a uniform manner the
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conditions of international transportation by air." Third, the
Convention does not contain any provision prescribing rules of
jurisdiction other than Article 28(1), which means that the phrase
"rules as to jurisdiction" used in Article 32 must refer only to Article
28(1). In fact, the last sentence of Article 32 specifically deals with the
exclusive enumeration in Article 28(1) as "jurisdictions," which, as
such, cannot be left to the will of the parties regardless of the time
when the damage occurred. Furthermore, respondent, in seeking
remedies from the trial court through special appearance of counsel, is
not deemed to have voluntarily submitted itself to the jurisdiction of
the trial court.

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