People V
People V
People V
Question:
Novartis Consumer Health Philippines Inc. (NOVARTIS) imported from Jinsuk Trading Co. Ltd.
(JINSUK) in South Korea, 19 pallets of 200 rolls of Ovaltine Power 18 Glaminated plastic
packaging material. In order to ship, JINSUK engaged the services of Protop Shipping
Corporation (PROTOP), a freight forwarder. PROTOP shipped the cargo through DONGNAMA
Shipping Co. Ltd. (DONGNAMA) which in turn loaded the same on M/V Heung-A Bangkok V-
019, owned and operated by Heung-A Shipping Corporation (HEUNG-A), pursuant to a ‘slot
charter arrangement’ whereby a space in the latter’s vessel was reserved for the exclusive use
of the former. NOVARTIS insured the shipment with Philam Insurance Company Inc. (PHILAM).
The shipment reached NOVARTIS, and upon inspection, the boxes of the shipment were wet
and damp. The shipment is entirely damaged and was found out that the damage was caused
by salt water. NOVARTIS rejected the shipment and filed an insurance claim with PHILAM and
the latter was subrogated to all the rights and claims of NOVARTIS. PHILAM filed a complaint for
damages against the parties to the shipment. HEUNG- A denied liability by arguing that he is
not the carrier in so far as NOVARTIS is concerned and asserted that its only obligation was to
provide DONGNAMA a space on board his ship. The trial court ruled declaring HEUNG-A as the
common carrier and held it liable. The ruling was affirmed by the appellate court.
Is Heung A liable to the damage sustained by the package for the reason that it is a common
carrier?
Answer:
YES, HEUNG-A is the common carrier. HEUNG-A’s slot charter arrangement with DONGNAMA is
a charter party arrangement. A charter party is a contract whereby an entire ship or some
principal part thereof, is let by the owner to another person for a specified time or use. It has
two types. First it could be a contract of affreightment whereby the use of shipping space on
vessels were leased in part or as a whole, to carry goods for others. The charter-party provides
for the hire of vessel only, either for a definite period of time (time charter) of for a single or
consecutive voyage (voyage charter). The shipowner supplies the ship’s stores, pay for the
wages of the master and the crew, and defray the expenses for the maintenance of the ship.
The voyage remains under the responsibility of the carrier and it is answerable for the loss of
goods received for transportation. The charterer is free from liability to third persons in respect
to the ship. Second, charter by demise or bareboat charter under which the whole vessel is let
to the charterer with a transfer to him of its entire command and possession and consequent
control over its navigation, including the master and the crew, who are his servants. The
charterer mans the vessel with his own people and becomes, in effect, the owner for the
voyage or service stipulated and hence liable for damages or loss sustained by the goods
transported. Clearly, the ‘slot charter arrangement’ between HEUNG-A and DONGNAMA,
where the latter is reserved a space in the vessel is a contract of affreightment. The
arrangement did not divest HEUNG-A its character as the common carrier nor relieve it of any
accountability for the shipment. As a common carrier, it is presumed to have been at fault or
negligent if the goods they transported deteriorated or got lost or destroyed, unless they prove
that they exercise extraordinary diligence in transporting the same. HEUNG-A failed to rebut
this prima facie presumption; hence, it is answerable for the damages incurred by the goods
received for transportation. WHEREFORE, all the foregoing considered, the Decision dated
January 30, 2009 of the Court of Appeals in CA-G.R. CV No. 89482 is hereby AFFIRMED with
MODIFICATION in that the interest rate on the award of US$8,500.00 shall be six percent (6%)
per annum from the date of finality of this judgment until fully paid.
People v. Go
GR. No. 210816. December 10, 2018
REYES, J. JR., J.:
By: Lawrence Greghill R. Bravo
Answer:
Yes. CA grossly erred in affirming the trial court’s Order granting the respondent’s demurrer,
which Order was patently null and void for having been issued with grave abuse of discretion
and manifest irregularity, thus causing substantial injury to the banking industry and public
interest.
The Court found that the prosecution has presented competent evidence to sustain the
indictment for the crime of estafa through falsification of commercial documents, and that
respondents appear to be the perpetrators thereof. What the trial and appellate courts
disregarded, however, is that the OCBC funds ended up in the personal bank accounts of
respondent Go, and were used to fund his personal checks, even as he was not entitled thereto.
These, if not rebutted, are indicative of estafa.
Hence, the Petition is GRANTED. Resolution of the Court of Appeals are REVERSED and SET
ASIDE. The July 2, 2007 and October 19, 2007 Orders of the Regional Trial Court of Manila,
Branch 49 in Criminal Case Nos. 00-187318 and 00-187319 are declared null and void, and the
said cases are ordered REINSTATED for the continuation of proceedings.
Question:
Crisostomo G. Concepcion (Concepcion) owned the vessel LCT-Josephine. He entered into a
Preliminary Agreement with Roland de la Torre (Roland), wherein Concepcion agreed that the
LCT Josephine would be chartered after its dry-docking and repair. Concepcion and the
Philippine
Trigon Shipyard Corporation (PTSC), represented by Roland, entered into a Contract of
Agreement, wherein the latter would charter LCT-Josephine. Subsequently, PTSC/Roland sub-
chartered LCT Josephine to Trigon Shipping Lines (TSL), a single proprietorship owned by
Roland’s father, Agustin de la Torre (Agustin). TSL, this time represented by Roland per
Agustin’s Special Power of Attorney, sub-chartered LCT-Josephine to Ramon Larrazabal
(Larrazabal) for the transport of cargo consisting of sand and gravel to Leyte. During the
unloading of the vessel’s cargo in Leyte, LCT-Josephine sank. Concepcion demanded that
PTSC/Roland refloat LCT-Josephine. The latter assured Concepcion that negotiations were
underway for the refloating of his vessel, but this did not materialize. This prompted
Concepcion to file a complaint for Sum of Money and Damages against PTSC and Roland. The
Regional Trial Court (RTC) declared that the efficient cause of the sinking of the LCT-Josephine
was the improper lowering or positioning of the ramp, which was well within the charge or
responsibility of the captain and crew of the vessel. The Court of Appeals (CA) affirmed. The
charterers and sub- charterers insist the application of the Limited Liability Rule to them.
Answer:
NO. The Limited Liability Rule under the Code of Commerce has been explained to be that of
the real and hypothecary doctrine in maritime law where the shipowner or ship agent’s liability
is held as merely co-extensive with his interest in the vessel such that a total loss thereof results
in its extinction. In this jurisdiction, this rule is provided in three articles of the Code of
Commerce. Article 837 specifically applies to cases involving collision which is a necessary
consequence of the right to abandon the vessel given to the shipowner or ship agent under
Article 587. Similarly, Article 590 is a reiteration of Article 587, only this time the situation is
that the vessel is co-owned by several persons. Obviously, the forerunner of the Limited
Liability Rule under the Code of Commerce is Article 587. Now, the latter is quite clear on which
indemnities may be confined or restricted to the value of the vessel pursuant to the said Rule,
and these are the indemnities in favor of third persons which may arise from the conduct of the
captain in the care of the goods which he loaded on the vessel. Thus, what is contemplated is
the liability to third persons who may have dealt with the shipowner, the agent or even the
charterer in case of demise or bareboat charter. The only person who could avail of this is the
shipowner, Concepcion. He is the very person whom the Limited Liability Rule has been
conceived to protect. The petitioners cannot invoke this as a defense. Concepcion, as the real
shipowner, is the one who is supposed to be supported and encouraged to pursue maritime
commerce. Thus, it would be absurd to apply the Limited Liability Rule against him who, in the
first place, should be the one benefitting from the said rule. Even if the contract is for a
bareboat or demise charter where possession, free administration and even navigation are
temporarily surrendered to the charterer, dominion over the vessel remains with the
shipowner. Ergo, the charterer or the sub-charterer, whose rights cannot rise above that of the
former, can never set up the Limited Liability Rule against the very owner of the vessel.