LU DO & LU YM CORPORATION vs. I. V.

BINAMIRA

FACTS:

Delta Photo Supply Company of New York shipped on board the M/S "FERNSIDE", six cases of
films and/or photographic supplies consigned to the order of respondent I. V. Binamira. Upon
arrival at the port of Cebu, said shipment was brought in the custody of arrastre operator
Visayan Cebu Terminal Company, Inc. which recorded the good order cargo and bad order
cargo. Consequently, petitioner, as agent of the carrier, hired the Cebu Stevedoring Company
Inc. (CSCI) to unload its cargo. CSCI also recorded good order cargo from the bad one. The
shipment in question was not included in the report of bad order cargo of both checkers,
indicating that it was discharged from the ship in good order and condition.

However, when respondent claimed said supplies from the arrastre operator, he discovered that
the cases showed signs of pilferage. The surveyors (R. J. del Pan & Company, Inc) hired by
respondent examined the cases and made a physical count of their contents in the presence of
representatives of petitioner, respondent and the stevedoring company. The finding of the
surveyors showed that some films and photographic supplies were missing valued at P324.63.

ISSUE:

WON carrier is responsible for the loss considering that the same occurred after the shipment
was discharged from the ship and placed in the possession and custody of the customs
authorities.

HELD:

NO. While delivery of the cargo to the consignee, or to the person who has a right to receive
them", contemplated in Article 1736, because in such case the goods are still in the hands of
the Government and the owner cannot exercise dominion over them, we believe however that
the parties may agree to limit the liability of the carrier considering that the goods have still to
through the inspection of the customs authorities before they are actually turned over to the
consignee. This is a situation where we may say that the carrier losses control of the goods
because of a custom regulation and it is unfair that it be made responsible for what may happen
during the interregnum. And this is precisely what was done by the parties herein. In the bill of
lading that was issued covering the shipment in question, both the carrier and the consignee
have stipulated to limit the responsibility of the carrier for the loss or damage that may be
caused to the goods before they are actually delivered.

It therefore appears clear that the carrier does not assume liability for any loss or damage to the
goods once they have been "taken into the custody of customs or other authorities", or when
they have been delivered at ship's tackle. These stipulations are clear. They have been adopted
precisely to mitigate the responsibility of the carrier considering the present law on the matter,
and we find nothing therein that is contrary to morals or public policy that may justify their
nullification. We are therefore persuaded to conclude that the carrier is not responsible for the
loss in question, it appearing that the same happened after the shipment had been delivered to
the customs authorities.