CIA Maritima v. Insurance Co.

of North  The damaged hemp was brought to Odell

America (1964) Plantation in Madaum, Davao, for cleaning,
washing, reconditioning, and redrying.
G.R. No. L-18965 October 30, 1964 o total loss adds up to P60,421.02
Lessons Applicable: Actionable Document  All abaca shipments of Macleod were insured
(Transportation) with the Insurance Company of North America
against all losses and damages
FACTS:  Macleod filed a claim for the loss it suffered
with the insurance company and was paid
 October, 1952: Macleod and Company of the P64,018.55
Philippines (Macleod) contracted by telephone o subrogation agreement between
the services of the Compañia Maritima (CM), Macleod and the insurance company
a shipping corporation, for: wherein the Macleod assigned its
o shipment of 2,645 bales of hemp from rights over the insured and damaged
the Macleod's Sasa private pier at cargo
Davao City to Manila  October 28, 1953.: failing to recover from the
o subsequent transhipment to Boston, carrier P60,421.02 (amount supported by
Massachusetts, U.S.A. on board the receipts), the insurance company instituted
S.S. Steel Navigator. the present action
 This oral contract was later on confirmed by a  CA affirmed RTC: ordering CM to pay the
formal and written booking issued by insurance co.
Macleod's branch office in Sasa and
handcarried to CM's branch office in Davao in ISSUE: W/N there was a contract of carriage bet. CM
compliance with which the CM sent to (carrier) and Macleod (shipper)
Macleod's private wharf LCT Nos. 1023 and
1025 on which the loading of the hemp was HELD: YES. Affirmed
completed on October 29, 1952.
o The 2 lighters were manned each by a  receipt of goods by the carrier has been said
patron and an assistant patron. to lie at the foundation of the contract to carry
 The patrons of both barges and deliver, and if actually no goods are
issued the corresponding received there can be no such contract
carrier's receipts and that o The liability and responsibility of the
issued by the patron of Barge carrier under a contract for the
No. 1025 reads in part: carriage of goods commence on
 Received in behalf of their actual delivery to, or receipt by,
S.S. Bowline Knot in the carrier or an authorized agent. ...
good order and and delivery to a lighter in charge of a
condition from vessel for shipment on the vessel,
MACLEOD AND where it is the custom to deliver in that
COMPANY OF way
PHILIPPINES, Sasa o Whenever the control and possession
Davao, for of goods passes to the carrier and
transhipment at Manila nothing remains to be done by the
onto S.S. Steel shipper, then it can be said with
Navigator. certainty that the relation of shipper
 FINAL DESTINATION: and carrier has been established
Boston.  As regards the form of the contract of carriage
 Early hours of October 30: LCT No. 1025 it can be said that provided that there is a
sank, resulting in the damage or loss of 1,162 meeting of the minds and from such meeting
bales of hemp loaded therein arise rights and obligations, there should be
o Macleod promptly notified the carrier's no limitations as to form
main office in Manila and its branch in o The bill of lading is not essential
Davao advising it of its liability  Even where it is provided by statute that
liability commences with the issuance of the
 bill of lading, actual delivery and acceptance
are sufficient to bind the carrier
 marine surveyors, attributes the sinking of
LCT No. 1025 to the 'non-water-tight
conditions of various buoyancy compartments
LU DO & LU YM CORPORATION
vs.
BINAMIRA G.R. No. L-9840 April 22, 1957
F: On August 10, 1951, the Delta Photo Supply
Company of New York shipped on board the M/S
"FERNSIDE" at New York, U.S.A., six cases of films
and/or photographic supplies consigned to the order
of respondent I. V. Binamira. For this shipment, Bill
of Lading No. 29 was issued. The ship arrived at the
port of Cebu on September 23, 1951 and discharged
her cargo on September 23, and 24, 1951, including
the shipment in question, placing it in the possession
and custody of the arrastre operator of said port, the
Visayan Cebu Terminal Company, Inc. Petitioner, as
agent of the carrier, hired the Cebu Stevedoring
Company, Inc. to unload its cargo. During the
discharge, good order cargo was separated from the
bad order cargo on board the ship, and a separate
list of bad order cargo was prepared by Pascual
Villamor, checker of the stevedoring company. All the
cargo unloaded was received at the pier by the
Visayan Cebu Terminal Company Inc, arrastre
operator of the port. This terminal company had also
its own checker, Romeo Quijano, who also recorded
and noted down the good 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. On September 26, 1951, three days
after the goods were unloaded from the ship,
respondent took delivery of his six cases of
photographic supplies from the arrastre operator. He
discovered that the cases showed signs of pilferage
and, consequently, he hired marine surveyors, R. J.
del Pan & Company, Inc., to examine them. The
surveyors examined the cases and made a physical
count of their contents in the presence of
representatives of petitioner, respondent and the
stevedoring company. The surveyors 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. It appears from the evidence that the six
cases of films and photographic supplies were
discharged from the ship at the port of Cebu by the
stevedoring company hired by petitioner as agent of
the carrier. All the unloaded cargo, including the
shipment in question, was received by the Visayan
Cebu Terminal Company Inc., the arrastre operator
appointed by the Bureau of Customs. It also appears
that during the discharge, the cargo was checked
both by the stevedoring company hired by petitioner
as well as by the arrastre operator of the port, and
the shipment in question, when discharged from the
ship, was found to be in good order and condition.
But after it was delivered to respondent three days
later, the same was examined by a marine surveyor
who found that some films and supplies were missing
valued at P324.63. Plaintiff filed an action in the Court
of First Instance of Cebu against defendant to recover
the sum of P324.63 as value of certain missing
shipment TC: ordering defendant to pay plaintiff the
sum of P216.84. CA Affirmed. I: 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? R: No, Carrier is not responsible
after the shipment was discharged and was place in
the custody of custom authorities. The
Carrier shall not be liable in any capacity whatsoever
for any delay, nondelivery or misdelivery, or loss of
or damage to the goods occurring while the goods
are not in the actual custody of the Carrier
.
Responsibility of the Carrier in any capacity shall
altogether cease and the goods shall be considered
to be delivered and at their own risk and expense in
every respect
when taken into the custody of customs or other
authorities.
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.
It is true that, as a rule, a common carrier is
responsible for the loss, destruction or deterioration
of the goods it assumes to carry from one place to
another unless the same is due to any to any of the
causes mentioned in Article 1734 on the new Civil
Code, and that, if the goods are lost, destroyed or
deteriorated, for causes other that those mentioned,
the common carrier is presumed to have been at fault
or to have acted negligently, unless it proves that it
has observed extraordinary diligence in their care
(Article 1735, Idem.), and that this extraordinary
liability lasts from the time the goods are placed in
the possession of the carrier until they are delivered
to the consignee, or "to the person who has the right
to receive them" (Article 1736,
Idem
.),
but these provisions only apply when the loss,
destruction or deterioration takes place while the
goods are in the possession of the carrier, and not
after it has lost control of them.
The reason is obvious. While the goods are in its
possession, it is but fair that it exercise extraordinary
diligence in protecting them from damage, and if loss
occurs, the law presumes that it was due to its fault
or negligence. This is necessary to protect the
interest the interest of the owner who is at its mercy.
The situation changes after the goods are delivered
to the consignee. Wherefore, the decision appealed
from is reversed, without pronouncement as to costs.
Servando v. Philippine Steam Navigation Co.
(1982)
G.R. No. L-36481-2 October 23, 1982
Lessons Applicable: Contract of Adhesion
(Transportation)
Laws Applicable: Article 1736, Article 1174
FACTS:
 Clara Uy Bico (1,528 cavans of rice
worth P40,907.50) and Amparo Servando (44
cartons of colored paper toys and general
merchandise worth P1,070.50) loaded on
board Philippine Steam Navigation
Co.'s vessel, FS-176 for carriage from Manila
to Pulupandan, Negros Occidental
o Bill of Lading:
 Clause 14. Carrier shall not be
responsible for loss or damage
to shipments billed 'owner's
risk' unless such loss or
damage is due to negligence of
carrier. Nor shall carrier be
responsible for loss or damage
caused by force majeure,
dangers or accidents of the sea
or other waters; war; public
enemies; . . . fire . ...
 Upon arrival of the vessel at Pulupandan, in
the morning of November 18, 1963, the
cargoes were discharged, complete and in
good order, unto the warehouse of the
Bureau of Customs
o 2 pm: warehouse was razed by fire
 Before the fire, 907 cavans of rice were
delivered by Uy Bico
 Uy Bico and Servando filed a claim for the
value but was rejected by Philippine Steam
 CFI: favored UY Bico and Sercando
o delivery of the shipment in question to
the warehouse of the Bureau of
Customs is not the delivery
contemplated by Article 1736
ISSUE: W/N Philippine Steam should not be liable
because of the stipulation in the bill of lading
exempting it from fortuitous event
HELD: YES. set aside
 Agreement was in iteration of
o Article 1174. Except in cases expressly
specified by the law, or when it is
otherwise declared by stipulation, or
when the nature of the obligation
requires the assumption of risk, no
person shall be responsible for those
events which could not be foreseen, or
which, though foreseen, were
inevitable.
 'caso fortuito' presents the following essential
characteristics: (1) the cause of the
unforeseen and unexpected occurrence, or of
the failure of the debtor to comply with his
obligation, must be independent of the
human will; (2) it must be impossible to
foresee the event which constitutes the 'caso
fortuito', or if it can be foreseen, it must be
impossible to avoid; (3) the occurrence must
be such as to render it impossible for the
debtor to fulfill his obligation in a normal
manner; and (4) the obligor must be free from
any participation in the aggravation of the
injury resulting to the creditor." In the case at
bar, the burning of the customs warehouse
was an extraordinary event which happened
independently of the will of the appellant. The
latter could not have foreseen the event.
 nothing in the record to show that appellant
carrier ,incurred in delay in the performance
of its obligation
Samar Mining Co., Inc. vs. Nordeutscher Lloyd makes actual or constructive delivery of the goods to
the consignee or to the person who has a right to
(132 SCRA 529)
receive them.

Facts: Samar Mining imported 1 crate optima welded

Under the Civil Code provisions governing Agency, an
wire (amounting to around USD 424 or PhP 1,700)
agent can only be held liable in cases where his acts
from Germany, which was shipped on a vessel owned
are attended by fraud, negligence, deceit or if there
by Nordeutscher Lloyd (M/S Schwabenstein). The
is a conflict of interest between him and the principal.
shipment was unloaded in Manila into a barge for
Under the same law an agent is likewise liable if he
transshipment to Davao and temporarily stored in a
appoints a substitute when he was not given the
bonded warehouse owned by AMCYL. The goods
power to appoint one or otherwise appoints one that
never reached Davao and were never delivered to or
is notoriously incompetent or insolvent. These facts
received by the consignee, Samar Mining Co.
were not proven in the record.

CFI ruled in favor of Samar Mining holding

Nordeutscher Lloyd liable. However, defendants may
recoup whatever they may pay Samar Mining by
enforcing the judgment against third party defendant
AMCYL.

Issue: Whether Nordeustscher Lloyd is liable for the

loss of the goods as common carrier?

Held: No. At the time of the loss of the goods, the

character of possession of Nordeutscher Lloyd shifted
from common carrier to agent of Samar Mining Co.

The Bill of Lading is serves both as a receipt of goods

and is likewise the contract to transport and deliver
the same as stipulated. It is a contract and is
therefore the law between the parties. The Bill of
Lading in question stipulated that Nordeutscher Lloyd
only undertook to transport the goods in its vessel
only up to the port of discharge from ship, which is
Manila. The Bill of Lading further stipulated that the
goods were to be transshipped by the carrier from
Manila to the port of destination – Davao. By
unloading the shipment in Manila and delivering the
goods to the warehouse of AMCYL, the appellant was
acting within the contractual stipulations contained in
the Bill of Lading.

Article 1736 of the Civil Code relives the carrier of

responsibility over the shipment as soon as the carrier
Ganzon v. CA (1988)
G.R. No. L-48757 May 30, 1988
Lessons Applicable: Actionable Document
Laws Cited: Art. 1736,Art. 1734
FACTS: Gelacio > Ganzon (via Capt. Niza) > Lighter
“Batman” (common carrier) (loaded half)
 November 28, 1956: Gelacio Tumambing
(Gelacio) contracted the services of of Mauro
B. Ganzon to haul 305 tons of scrap iron
from Mariveles, Bataan, to the port of Manila
on board the light LCT “Batman”
 December 1, 1956: Gelacio delivered the
scrap iron to Filomeno Niza, captain of the
lighter, for loading which was actually begun
on the same date by the crew of the lighter
under the captain’s supervisor.
 When about half of the scrap iron was
already loaded, Mayor Jose Advincula of
Mariveles, Bataan arrived and demanded
P5000 from Gelacio
o Upon resisting, the Mayor fired at
Gelacio so he had to be taken to the
hospital
o Loading of the scrap iron was
resumed
 December 4, 1956: Acting Mayor Basilio Rub
(Rub), accompanied by 3 policemen, ordered
captain Filomeno Niza and his crew to dump
the scrap iron where the lighter was docked
o Later on Rub had taken custody of
the scrap iron
 RTC: in favor of Gelacio and against Ganzon
ISSUE: W/N Ganzon should be held liable under the
contract of carriage
HELD: YES. Petition is DENIED.
 Ganzon thru his employees, actually received
the scraps is freely admitted.
 Pursuant to Art. 1736, such extraordinary
responsibility would cease only upon the
delivery, actual or constructive, by the carrier
to the consignee, or to the person who has a
right to receive them.
 The fact that part of the shipment had not
been loaded on board the lighter did not
impair the said contract of transportation as
the goods remained in the custody and
control of the carrier, albeit still unloaded.
 failed to show that the loss of the scraps was
due to any of the following causes
enumerated in Article 1734 of the Civil Code,
namely:
(1) Flood, storm, earthquake, lightning, or other
natural disaster or calamity;
(2) Act of the public enemy in war, whether
international or civil;
(3) Act or omission of the shipper or owner of the
goods;
(4) The character of the goods or defects in the
packing or in the containers;
(5) Order or act of competent public authority.
Hence, the petitioner is presumed to have been at
fault or to have acted negligently.
 By reason of this presumption, the court is
not even required to make an express
finding of fault or negligence before it could
hold the petitioner answerable for the breach
of the contract of carriage.
o exempted from any liability had he
been able to prove that he observed
extraordinary diligence in the
vigilance over the goods in his
custody, according to all the
circumstances of the case, or that the
loss was due to an unforeseen event
or to force majeure. As it was, there
was hardly any attempt on the part
of the petitioner to prove that he
exercised such extraordinary
diligence.
 We cannot sustain the theory of caso fortuito
- "order or act of competent public
authority"(Art. 1174 of the Civil Code)
o no authority or power of the acting
mayor to issue such an order was
given in evidence. Neither has it been
shown that the cargo of scrap iron
belonged to the Municipality of
Mariveles.
 Ganzon was not duty bound
to obey the illegal order to
dump into the sea the scrap
iron.
 Moreover, there is absence of
sufficient proof that the
issuance of the same order
was attended with such force
or intimidation as to
completely overpower the will
of the petitioner's employees.
The mere difficulty in the
fullfilment of the obligation is
not considered force
majeure.
MACAM vs. COURT OF APPEALS GR No. 125524;
August 25, 1999
Facts: Benito Macam, doing business under name
Ben-Mac Enterprises, shipped on board vessel Nen-
Jiang, owned and operated by respondent China
Ocean Shipping Co. through local agent Wallem
Philippines Shipping Inc., 3,500 boxes of watermelon
covered by Bill of Lading No. HKG 99012, and 1,611
boxes of fresh mangoes covered by Bill of Lading No.
HKG 99013. The shipment was bound for Hongkong
with PAKISTAN BANK as consignee and Great
Prospect Company of Rowloon (GPC) as notify party.
Upon arrival in Hongkong, shipment was delivered by
respondent WALLEM directly to GPC, not to
PAKISTAN BANK and without the required bill of
lading having been surrendered. Subsequently, GPC
failed to pay PAKISTAN BANK, such that the latter,
still in possession of original bill of lading, refused to
pay petitioner thru SOLIDBANK. Since SOLIDBANK
already pre-paid the value of shipment, it demanded
payment from respondent WALLEM but was refused.
MACAM constrained to return the amount paid by
SOLIDBANK and demanded payment from WALLEM
but to no avail.
WALLEM submitted in evidence a telex dated 5 April
1989 as basis for delivering the cargoes to GPC
without the bills of lading and bank guarantee. The
telex instructed delivery of various shipments to the
respective consignees without need of presenting the
bill of lading and bank guarantee per the respective
shipper’s request since “for prepaid shipt ofrt charges
already fully paid.” MACAM, however, argued that,
assuming there was such an instruction, the
consignee referred to was PAKISTAN BANK and not
GPC.
The RTC ruled for MACAM and ordered value of
shipment. CA reversed RTC’s decision.
Issue: Are the respondents liable to the petitioner
for releasing the goods to GPC without the bills of
lading or bank guarantee?
Held: It is a standard maritime practice when
immediate delivery is of the essence, for shipper to
request or instruct the carrier to deliver the goods to
the buyer upon arrival at the port of destination
without requiring presentation of bill of lading as that
usually takes time. Thus, taking into account that
subject shipment consisted of perishable goods and
SOLIDBANK pre-paid the full amount of value
thereof, it is not hard to believe the claim of
respondent WALLEM that petitioner indeed requested
the release of the goods to GPC without presentation
of the bills of lading and bank guarantee.
To implement the said telex instruction, the delivery
of the shipment must be to GPC, the notify party or
real importer/buyer of the goods and not the
PAKISTANI BANK since the latter can very well
present the original Bills of Lading in its possession.
Likewise, if it were the PAKISTANI BANK to whom the
cargoes were to be strictly delivered, it will no longer
be proper to require a bank guarantee as a substitute
for the Bill of Lading. To construe otherwise will
render meaningless the telex instruction. After all, the
cargoes consist of perishable fresh fruits and
immediate delivery thereof the buyer/importer is
essentially a factor to reckon with.
We emphasize that the extraordinary responsibility of
the common carriers lasts until actual or constructive
delivery of the cargoes to the consignee or to the
person who has a right to receive them. PAKISTAN
BANK was indicated in the bills of lading as consignee
whereas GPC was the notify party. However, in the
export invoices GPC was clearly named as
buyer/importer. Petitioner also referred to GPC as
such in his demand letter to respondent WALLEM and
in his complaint before the trial court. This premise
draws us to conclude that the delivery of the cargoes
to GPC as buyer/importer which, conformably with
Art. 1736 had, other than the consignee, the right to
receive them was proper.
 SCHMITZ TRANSPORT & BROKERAGE
CORPORATION v. TRANSPORT VENTURE,
INC., INDUSTRIAL INSURANCE COMPANY,
LTD., et al.
456 SCRA 557 (2005)
A common carrier shall exercise extraordinary
diligence to prevent and/or minize the loss or
destruction of goods.
SYTCO Pte Ltd. Singapore shipped from the port of
Ilyichevsk, Russia on board M/V ―Alexander
Saveliev‖ (a vessel of Russian registry and owned by
respondent Black Sea) 545 hot rolled steel sheets. The
vessel arrived at the port of Manila and the Philippine
Ports Authority (PPA) assigned it a place of berth at
the outside breakwater at the Manila South Harbor.
Petitioner Schmitz Transport, engaged to secure the
requisite clearances, to receive the cargoes from the
shipside, and to deliver them to Little Giant Steelpipe
Corporation‘s warehouse at Cainta, Rizal. It likewise
engaged the services of respondent Transport Venture
Inc. (TVI) to send a barge and tugboat at shipside.
The tugboat, after positioning the barge alongside the
vessel, left and returned to the port terminal. Later on,
arrastre operator commenced to unload 37 of the 545
coils from the vessel unto the barge. By noon the next
day, during which the weather condition had become
inclement due to an approaching storm, the unloading
unto the barge of the 37 coils was accomplished.
However, there was no tugboat that pulled the barge
back to the pier. Eventually, because of the strong
waves, the crew of the barge abandoned it and
transferred to the vessel. The barge capsized, washing
the 37 coils into the sea. Earnest efforts on the part of
both the consignee Little Giant and Industrial
Insurance to recover the lost cargoes proved futile.
Industrial Insurance later filed a complaint against
Schmitz Transport, TVI and Black Sea through its
representative Inchcape (the defendants) before the
RTC of Manila, for the recovery of the amount it paid
to Little Giant plus adjustment fees, attorney‘s fees,
and litigation expenses. Industrial Insurance won and
the Schmitz et al.’s motion for reconsideration is
denied.
In effect, Schmitz now filed charges against TVI et al.
It asserts that in chartering the barge and tugboat of
TVI, it was acting for its principal, consignee Little
Giant, hence, the transportation contract was by and
between Little Giant and TVI. The Court rendered a
decision holding Schmitz and TVI liable.
ISSUES:
Whether or not the liability for the loss may attach to
Black Sea, Schmitz and TVI
HELD:
TVI‘s failure to promptly provide a tugboat did not
only increase the risk that might have been reasonably
anticipated during the shipside operation, but was the
proximate cause of the loss. A man of ordinary
prudence would not leave a heavily loaded barge
floating for a considerable number of hours, at such a
precarious time, and in the open sea, knowing that the
barge does not have any power of its own and is
totally defenseless from the ravages of the sea. That it
was nighttime and, therefore, the members of the crew
of a tugboat would be charging overtime pay did not
excuse TVI from calling for one such tugboat.
As for Schmitz, for it to be relieved of liability, it
should, following Article 1739 of the Civil Code,
prove that it exercised due diligence to prevent or
minimize the loss, before, during and after the
occurrence of the storm in order that it may be
exempted from liability for the loss of the goods.
While Schmitz sent checkers and a supervisor on
board the vessel to counter-check the operations of
TVI, it failed to take all available and reasonable
precautions to avoid the loss. After noting that TVI
failed to arrange for the prompt towage of the barge
despite the deteriorating sea conditions, it should have
summoned the same or another tugboat to extend
help, but it did not.
The Court holds then that Schmitz and TVI are
solidarily liable for the loss of the cargoes. As for
Black Sea, its duty as a common carrier extended only
from the time the goods were surrendered or
unconditionally placed in its possession and received
for transportation until they were delivered actually or
constructively to consignee Little Giant
Parties to a contract of carriage may, however, agree
upon a definition of delivery that extends the services
rendered by the carrier. In the case at bar, Bill of
Lading No. 2 covering the shipment provides that
delivery be made ―to the port of discharge or so near
thereto as she may safely get, always afloat.‖ The
delivery of the goods to the consignee was not from
―pier to pier‖ but from the shipside of ―M/V
Alexander Saveliev‖ and into barges, for which reason
the consignee contracted the services of petitioner.
Since Black Sea had constructively delivered the
cargoes to Little Giant, through Schmitz, it had
discharged its duty.

In fine, no liability may thus attach to Black Sea.