15) Midanao Terminal V Phoenix Assurance

Calleja Mindanao Terminal observed the degree of diligence required by law of a
15. GR No. 162467 May 8, 2009 stevedoring company. [YES.]

MINDANAO TERMINAL and BROKERAGE vs. PHOENIX ASSURANCE Held:
Topic: Common Carriers 1st issue:
Facts: Article 1173 of the Civil Code is very clear that if the law or contract does
1. Del Monte Philippines contracted petitioner Mindanao Terminal and not state the degree of diligence which is to be observed in the
Brokerage Service, Inc, a stevedoring company, to load and stow a performance of an obligation then that which is expected of a good father
shipment of 146,288 cartons of fresh green Bananas and 15,202 cartons of of a family or ordinary diligence shall be required.
fresh pineapples belongingto Del Monte Produce into the cargo hold of the o There is no specific provision of law that imposes a higher degree
vessel M/V Mistrau of diligence than ordinary diligence for a stevedoring company or
2. The vessel was docked at the port of Davao and the goods were to be one who is charged only with the loading and stowing of cargoes.
transported to Incheon, Korea in favor of consignee Taegu Industries. o It was neither alleged nor proven by Phoenix and McGee that
3. Del Monte Produce insured the shipment under an open cargo policy with Mindanao Terminal was bound by contractual stipulation to
private respondent Phoenix Assurance Company of New York, a non-life observe a higher degree of diligence than that required of a good
insurance company, and private respondent McGee & Co, the underwriting father of a family.
manager/agent of Phoenix. A stevedore is not a common carrier for it does not transport goods or
4. Upon arrival of M/V Mistrau in Incheon, it was discovered upon discharge passengers; it is not akin to a warehouseman for it does not store goods
that some of the cargo was in bad condition for profit. The loading and stowing of cargoes would not have a far
5. The damage surveyor of Korea, Byeong, surveyed that 16,069 cartons of reaching public ramification as that of a common carrier and a
the banana shipment and 2,185 cartons of the pineapple shipment were so warehouseman; the public is adequately protected by our laws on contract
damaged that they no longer had commercial value. and on quasi-delict. The public policy considerations in legally imposing
6. Del Monte Produce filed a claim under the open cargo policy. McGees upon a common carrier or a warehouseman a higher degree of diligence is
Marine Claims evaluated the claim and recommended that payment in the not present in a stevedoring outfit which mainly provides labor in loading
amount of $210,266.43 be made. Del Monte issued a subrogation receipt and stowing of cargoes for its clients.
to Phoenix and McGee.
7. Phoenix and McGee instituted an action for damages against Mindanao 2nd issue:
Terminal.
8. RTC ruled that the only participation of Mindanao Terminal was to load the Phoenix and McGee failed to prove by preponderance of evidence that
cargoes on board the vessel and under the direction and supervision of the Mindanao Terminal had acted negligently. Where the evidence on an issue
ships officers, who would not have accepted the cargoes on board the of fact is in equipoise or there is any doubt on which side the evidence
vessel and signed the foremans report unless they were properly arranged preponderates the party having the burden of proof fails upon that issue.
and tightly secured to withstand voyage across the open seas. The only participation of Mindanao Terminal was to load the cargoes on
9. CA reversed the RTC s decision which sustained Phoenixs and McGees board M/V Mistrau. It was not disputed by Phoenix and McGee that the
argument that the damage in the cargoes was the result of the improper materials, such as ropes, pallets, and cardboards, used in lashing and
stowage by Mindanao Terminal. rigging the cargoes were all provided by M/V Mistrau and these materials
It imposed on Mindanao Terminal, as the stevedore of the cargo, meets industry
the duty to exercise extraordinary diligence in loading and standard.
stowing the cargoes. o A foremans report, as proof of work done on board the vessel,
Issue/s: was prepared by the checkers of Mindanao Terminal and
1. Whether Mindanao Terminal, as a stevedoring company, is under obligation to concurred in by the Chief Officer of M/V Mistrau after they were
observe the same extraordinary degree of diligence in the conduct of its business as satisfied that the cargoes were properly loaded.
required by law for common carriers and warehousemen.[NO.] and 2. Whether

15) Midanao Terminal V Phoenix Assurance

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Calleja Mindanao Terminal observed the degree of diligence required by law of a

15. GR No. 162467 May 8, 2009 stevedoring company. [YES.]

Topic: Common Carriers 1st issue:

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