Standard Oil Company of New York vs.

Manuel Lopez Castelo

47 Phil. 256

FACTS:
Castelo, owner of a small interisland steamer, the Batangueo, let to Chumbuque, by contract of charter,
for use in conveying of cargo between certain ports of the Philippine Islands.

The contract has stipulated that the officers and crew of the Batangueo should be supplied by the
owner, and that the charterer should have no other control over the captain, pilot, and engineers than to
specify the voyages that they should make and to require the owner to discipline or relieve them as soon
as possible in case they should fail to perform the duties respectively assigned to them.

While the boat was being thus used by the charterer in the interisland trade, the Standard Oil Company
delivered to the agent of the boat in Manila a quantity of petroleum to be conveyed to the port of
Casiguran, in the Province of Sorsogon.

For this consignment a bill of lading of the usual form was delivered, with the stipulation that freight
should be paid at the destination. Said bill of lading contained no provision with respect to the storage of
the petroleum, but it was in fact placed upon the deck of the ship and not in the hold.

While the boat was on her way to the port mentioned, and off the western coast of Sorsogon, a violent
typhoon passed over that region, and while the storm was at its height the captain was compelled for the
safety of all to jettison the entire consignment of petroleum consisting of 200 cases.

When the storm abated the ship made port, and 13 cases of the petroleum were recovered, but the
remainder was wholly lost.

ISSUES:
WON the loss of this petroleum was a general average loss or a particular loss to be borne solely
by the owner of the cargo
WON the charterer may be held liable of the loss of the goods

HELD:
1st Issue
The loss was a General Average Loss. It is a general rule (xxx) that ordinarily the loss of cargo carried
on deck shall not be considered a general average loss. The reason for this rule is found in the fact that
deck cargo is in an extra-hazardous position and, if on a sailing vessel, its presence is likely to obstruct
the free action of the crew in managing the ship. Moreover, especially in the case of small vessels, it
renders the boat top-heavy and thus may have to be cast overboard sooner than would be necessary if it
were in the hold; and naturally it is always the first cargo to go over in case of emergency. Indeed, in Art
815 of Code of Commerce, it is expressly declared that deck cargo shall be cast overboard before cargo
stowed in the hold.

However, with the advent of the steamship as the principal conveyer of cargo by sea, it has been felt that
the reason for the rule has become less weighty, especially with reference to coastwise trade; and it is
now generally held that jettisoned goods carried on deck, according to the custom of trade, by steam
vessels navigating coastwise and inland waters, are entitled to contribution as a general average loss.

2nd Issue
Yes. It is the courts opinion, that the shipper will go after the owner of the ship and the agent. The
shipper may also have his recourse against the captain.

Primary liability is placed upon the person who has actual control over the conduct of the voyage and who
has most capital embarked in the venture, namely, the owner of the ship, leaving him to obtain recourse,
as it is very easy to do, from other individuals who have been drawn into the venture as shippers

The captain, by article 852 of the Code of Commerce, is required to initiate the proceedings for the
adjustment, liquidation, and distribution of any gross average to which the circumstances of the voyage
may have given origin; and it is therefore his duty to take the proper steps to protect any shipper whose
goods may have been jettisoned for the general safety

In the case before us the captain of the vessel did not take those steps; and the court is of the opinion
that the failure of the captain to take those steps gave rise to a liability for which the owner of the ship
must answer.
Yu Con vs. Ipil, et. al.
41 Phil 770

FACTS:
Yu Con is a merchant engaged in the sale of cloth and domestic articles. He has engaged for several
times a charter for a banca, the Maria, owned by Narciso Lauron, which was mastered by Glicerio Ipil and
Justo Salomo. On one transaction, Plaintiff had delivered a trunk of goods and money. However, such
cargo and money has disappeared while the ship was still on dock awaiting departure.

ISSUE:
WON the three defendants may be held liable.

HELD:
In order that a thing may be transported, it must be delivered to the carrier. From the time it is delivered to
the carrier or shipper until it is received by the consignee, the carrier has it in his possession, as a
necessary condition for its transportation, he is obliged to preserve and guard it.

Having failed to exercise for its safe-keeping the diligence required by the nature of the obligation
assumed by them and by the circumstances of the time and the place, it is evident that, in pursuance of
the provisions of articles 1601 and 1602, in their relation to articles 1783 and 1784, and as prescribed in
articles 1770, of the Civil Code, they are liable for its loss or misplacement and must restore it to the
plaintiff, together with the corresponding interest thereon as an indemnity for the losses and damages
caused him through the loss of the said sum.

In maritime commerce, the shippers and passengers in making contracts with the captain do so through
the confidence they have in the shipowner who appointed him; they presume that the owner made a most
careful investigation before appointing him, and, above all, they themselves are unable to make such an
investigation, and even though they should do so, they could not obtain complete security, inasmuch as
the shipowner can, whenever he sees fir, appoint another captain instead.

The shipowner is in the same case with respect to the members of the crew, for, though he does not
appoint directly, yet, expressly or tacitly, he contributes to their appointment. On the other hand, if the
shipowner derives profits from the results of the choice of the captain and the crew, when the choice turns
out successful, it is also just that he should suffer the consequences of an unsuccessful appointment, by
application of the rule of natural law contained in the Partidas, viz., that he who enjoys the benefits
derived from a thing must likewise suffer the losses that ensue therefrom.

For legal purposes, that is, for the determination of the nature and effect of the relations created between
the plaintiff, as owner of the merchandise laden on said craft and of the money that was delivered to the
master, Ipil, and the defendant Lauron, as owner of the craft, the latter was a vessel, according to the
meaning and construction given to the word vessel in the Mercantile Code, in treating of maritime
commerce, under Title 1, Book 3.

The word vessel serves to designate every kind of craft by whatever particular or technical name it may
now be known or which nautical advancements may give it in the future. According to the foregoing
definitions, then, we should hold that the banca called Maria, chartered by the plaintiff Yu Con from the
defendant Narciso Lauron, was a "vessel", pursuant to the meaning this word has in mercantile law, that
is, in accordance with the provisions of the Code of Commerce in force.

The name of captain or master is given, according to the kind of vessel, to the person in charge of it.
Captain is applied to those who govern vessels that navigate the high seas or ships of large dimensions
and importance, although they be engaged in the coastwise trade. Masters are those who command
smaller ships engaged exclusively in the coastwise trade.

For the purposes of maritime commerce, the words "captain" and "master" have the same meaning; both
being the chiefs or commanders of ships.