Topic: Perils of the Sea v Perils of the Ship

VECTOR SHIPPING CORPORATION and FRANCISCO SORIANO, petitioners, vs. ADELFO B. MACASA, EMELIA
B. MACASA, TIMOTEO B. MACASA, et al, respondents.
G.R. No. 160219. July 21, 2008

FACTS:

 Spouses Cornelio and Anacleta Macasa together with their 8-year old grandson, Ritchie Macasa, boarded
the MV Doña Paz at Tacloban bound for Manila. The vessel was owned and operated by respondent
Sulpicio Lines, Inc.

 Evening of December 20, MV Doña Paz collided with the MT Vector, an oil tanker owned and operated by
petitioners Vector Shipping Corporation and Francisco Soriano. MT Vector at the time was loaded which
with 860,000 gallons of gasoline and other petroleum products, as it was chartered by Caltex Philippines
Inc.

 Only 26 persons survived: 24 passengers of MV Doña Paz and 2 crew members of MT Vector. Cornelio,
Anacleta and Ritchie were among the victims whose bodies have yet to be recovered up to this day.

 In October 1991, respondent children of Cornelio and Anacleta and parents of Ritchie (the Macasas) filed
a Complaint for Damages arising out of breach of contract of carriage against Sulpicio Lines before the
RTC.

 The complaint imputed negligence to Sulpicio Lines because it was remiss in its obligations as a common
carrier. The Macasas prayed for civil indemnity in the amount of P800K (for the death of the 3 relatives, as
well as unearned income of Cornelio and Anacleto who were both working as vocational instructors
before their demise). The Macasas also claimed P100K as actual and compensatory damages for the lost
personal belongings (cash, checks, jewelries and others) P600K in moral damages, P100K by way of
exemplary damages, and P100K as costs and attorney’s fees.

 Sulpicio Lines traversed the complaint, alleging, among others that MV Doña Paz was seaworthy in all
aspects; it exercised extraordinary diligence in transporting their passengers and goods; the sinking of MV
Doña Paz was without contributory negligence on its part; and the collision was MT Vector’s fault since it
was allowed to sail with an expired coastwise license, expired certificate of inspection and it was manned
by unqualified and incompetent crew members per findings of the Board of Marine Inquiry (BMI) in a BMI
Case which had exonerated Sulpicio Lines from liability. Thus, Sulpicio Lines filed a Third-Party Complaint
against Vector Shipping, Soriano and Caltex (MT Vector’s charterer).

 The RTC decided in favor of the Macasas and ordered Sulpicio Lines to pay the Macasas P200K as civil
indemnity for the death of Cornelio, Anacleta and Ritchie; P100K as actual damages; P500K as moral
damages; P100,000.00 as exemplary damages; and P50K as attorney’s fees.

 Also, the RTC held third-party defendants Caltex and MT Vector Shipping Corporation and/or Soriano,
liable against Sulpicio Lines, for reimbursement, subrogation and indemnity on all amounts, defendant
Sulpicio Lines was ordered liable against the Macasas.

 Aggrieved, Sulpicio Lines, Caltex, Vector Shipping and Soriano appealed to the CA. The CA modified the
RTC decision in that it exonerated Caltex from liability. The P100Kactual damages is deleted while the civil
indemnity was reduced to P150K. The CA ruled that MT Vector was unseaworthy at the time of the
mishap (it was the negligence of MT Vector’s officers and crew which caused the collision, moreover,
 carrying expired coastwise license and permits and was not properly manned). Hence this petition by
Vector Shipping and Francisco.

ISSUE: Whether Sulpicio Lines has a right to reimbursement and indemnification from the third-party defendants
Soriano and Vector Shipping?

RULING: YES.

In 1999, the case Caltex (Philippines), Inc. v. Sulpicio Lines, Inc., was decided where the SC held that MT Vector fits
the definition of a common carrier under Article 1732 of the New Civil Code. The ruling in that case was
instructive:

“ Thus, the carriers are deemed to warrant impliedly the seaworthiness of the ship. For a vessel to be
seaworthy, it must be adequately equipped for the voyage and manned with a sufficient number of
competent officers and crew. The failure of a common carrier to maintain in seaworthy condition the
vessel involved in its contract of carriage is a clear breach of its duty prescribed in Article 1755 of the Civil
Code.”

The provisions owed their conception to the nature of the business of common carriers. This business is impressed
with a special public duty. The public must of necessity rely on the care and skill of common carriers in the
vigilance over the goods and safety of the passengers, especially because with the modern development of science
and invention, transportation has become more rapid, more complicated and somehow more hazardous. For these
reasons, a passenger or a shipper of goods is under no obligation to conduct an inspection of the ship and its crew,
the carrier being obliged by law to impliedly warrant its seaworthiness.

The SC agreed with CA’s ruling that MT Vector was unseaworthy at the time of the mishap.

Petition denied.

NOTES:

The SC agreed with the findings of the CA when it aptly held:

“We are not swayed by the lengthy disquisition of MT Vector and Francisco Soriano urging this Court to absolve
them from liability. All evidence points to the fact that it was MT Vector’s negligent officers and crew which caused
it to ram into MV Doña Paz. More so, MT Vector was found to be carrying expired coastwise license and permits
and was not properly manned. As the records would also disclose, there is a defect in the ignition system of the
vessel, and it was not convincingly shown whether the necessitated repairs were in fact undertaken before the
said ship had set to sea. In short, MT Vector was unseaworthy at the time of the mishap. That the said vessel was
allowed to set sail when it was, to everyone in the group’s knowledge, not fit to do so translates into rashness and
imprudence.