TRANSPORTATION LAWS- SEA ACTChua vs. Everett Steamship L-5554 May 27, 1953FACTS: Chua ordered for 500 cases of evaporated milk of 90 babies from the Columbia Pacific Distributing Company of Portland with the price of $3,825, including the freight charges thereafter amounting 4127.94. It was paid through China Banking Corporation. TheS/S H.H. Raymondarrived at the port of Manila on February 21, 1947, discharged the cargo and delivered it to the custody of the Manila Terminal Company. On February 26, 1947, the Manila Terminal Company delivered the cargo to Mun Sheng Trading, through the Serrano Transportation, a local broker. Chua plaintiff discovered that the cargo delivered to him consisted of 500 cases of 48 babies of evaporated milk, and not 96 babies as ordered by him. Chua immediately gave notice to the Everett steamship of the shortage in the cargo delivered. Certain negotiations for the amicable settlement of the matter failed. Then, action for claim of loss was instituted on May 7, 1948. CA affirmed CFIs decision which holds that the action of Chua "has already been barred by operation of law."

ISSUES: 1) Whether the Carriage of Goods by Sea Act is applicable, as claimed by respondent, or the same should be governed by the Code of Commerce or other laws, as claimed by petitioner; (2) Whether the action of petitioner has already prescribed;

RULING:1) Yes. CA did not erring in holding that the Act is applicable to the transaction. *Chua contends: Act cannot apply to the contract for carriage of the goods in question because at the time said Act was made applicable to the Philippines the latter was still a possession or territory of the United States. (Sec. 13, Sea Act) - If before the Philippines declaration of independence, the trade relations between the Philippines and the United States could only be considered in a domestic sense, after it had become independent said trade relations must have of necessity acquired the character of foreign within the meaning of said Act. - There is no need of an express legislation to have the provisions of said Act applicable to the Philippines upon the advent of independence, as claimed by petitioner, for the simple reason that in enacting Commonwealth Act No. 65, already provided therein that said provisions should be made applicable "to all contracts for the carriage of goods by sea to and from Philippine ports of foreign trade."2) Yes. An action for recovery of loss or damage should be brought within one year after delivery of said cargo. The action was commenced only on May 7, 1948, or after the lapse one year, two months and nine days from the delivery of the goods to Chua.*Chua contends: The prescriptive period embodied in the Carriage of Goods by Sea Act has no application to the case at bar because the period of prescription that should be considered is that embodies in the Code of Civil Procedure. - Untenable. Code of Civil Procedure is a general law which only applies to cases not covered by any special act. *Chua contends: The prescriptive period provided therein could not apply to petitioner upon the theory that "such time-bar applies to the shipper only, and not to a person other than the shipper."- Unwarranted. Reading the rest of Sec. 3 (6), it seems clear that the notice of loss or damage is required to be filed not necessarily by the shipper but also by the consignee or any legal holder of the bill of lading. Also, a study of the historical background of this particular provision will show that the intention of the law was not to exclude the consignee or endorsee of the bill of lading from bringing the action but merely to limit the filing of the same within one year after the delivery of the goods at the port of discharge.*Chua contends: the negotiations conducted to reaching an amicable settlement which caused the delay in the filing of the present action constitute a waiver on the part of the Everett Steamship to set up the prescriptive period or operates as a estoppel on his part to rely on such prescriptive period. - Untenable. The rule is well-settled that a mere proposal for arbitration or the fact that negotiations have been made for the adjustment of a controversy, even if the proposal is not acted upon, or the adjustment is not carried out, does not suspend the running of the period of prescription, unless there is an express agreement to the contrary. Here there is no such agreement.

Aetna Insurance vs. Luzon Stevedoring 62 SCRA 11FACTS: Aetna Insurance Company, as insurer, filed a complaint against Barber Steamship Lines, Inc., Luzon Stevedoring Corporation and Luzon Brokerage Corporation. It sought to recover the sum of P12,100.06 as the amount of the damages which were caused to a cargo of truck parts shipped on the SSTurandot. The insurer paid the damages to Manila Trading & Supply Company, the consignee. Barber Steamship Lines, Inc alleged that it was a foreign corporation not licensed to do business in the Philippines, that it was not engaged in business here, that it had no Philippine agent and that it did not own nor operate the SSTurandot. Aetna filed a manifestation stating that the name of defendant Barber Steamship Lines, Inc. was incorrect and that the correct name was Barber Line Far East Service. Barber Line Far East Service moved for the dismissal of the amended complaint on the grounds (1) that it is not a juridical person and, hence, it could not be sued; (2) that the court had no jurisdiction over its person; (3) that it was not the real party in interest and (4) that the action had prescribed according to the bill of lading and the Carriage of Goods by Sea Act. The case was dismissed as to Barber Line Far East Service based on the prescription period.

ISSUES: Whether the action of Aetna Insurance Company against Barber Line Far East Service, as ventilated in its amended complaint, which was filed on April 7, 1965, had prescribed.

RULING: Yes. The trial court correctly held that the one-year statutory and contractual prescriptive period had already expired .The one year period commenced on February 25, 1964 when the damaged cargo was delivered to the consignee.* Aetna invokes: the rule that where the original complaint states a cause of action but does it imperfectly, and afterwards an amended complaint is filed, correcting the defect, the plea of prescription will relate to the time of the filing of the original complaint. - Untenable. The filing of the original complaint interrupted the prescriptive period as to Barber Steamship Lines, Inc. but not as to Barber Line Far East Service, an entity supposedly distinct from the former. - That ruling would apply to defendants Luzon Stevedoring Corporation and Luzon Brokerage Corporation. But it would not apply to Barber Line Far East Service which was impleaded for the first time in the amended complaint.

American Insurance vs. Compania Maritima 21 SCRA 998FACTS: A certain cargo insured by American Insurance was shipped in New York, U.S. aboard "M/S TOREADOR", of which the general agent in the Philippines is Macondray & Co., Inc. The final port of call of the " M/S TOREADOR" was Manila. M/S TOREADOR agreed to transship the cargo after its discharge in Manila, aboard an inter-island vessel to its destination in Cebu. On September 18, 1962, the " M/S TOREADOR" arrived at the port of Manila and on the same date discharged the cargo. The cargo was subsequently loaded aboard the "SS SIQUIJOR and finally discharged in Cebu on September 24, 1962. The consignee found out that there was a short of two (2) pieces of tractor parts. American Insurance paid the insured value of the lost merchandise to the consignee. On September 24, 1963 a complaint against the Compaia Maritima and the Visayan Cebu Terminal Co., Inc. as alternative defendants. Compania Maritima was sued as operator and owner of "SS SIQUIJOR" and the latter as operator of the arrastre service at the port of Cebu charged with the care and custody of all cargo discharged there. American Insurance filed on November 6, 1964 a motion to admit its amended complaint impleading Macondray and Luzon Brokerage Corporation as additional defendants and eliminating the Visayan Cebu Terminal Co., Inc. CFI ordered the dismissal of the amended complaint of American Insurance on the ground of prescription

ISSUES: Whether or not American Insurance action had already prescribed

RULING: Yes. *American Insurance contends: that the one year prescriptive period provided for in the Carriage of Goods by Sea Act does not apply which should be governed by the statute of limitations in the Civil Code. It is pointed out that the cargo was transshipment cargo; that the discharge thereof in Manila terminated the obligation of Macondray as carrier; and that its obligation to transship the cargo to Cebu was merely that of a "forwarding agent" of the shipper. (Clause 11, bill of lading)- Pursuant to bill of lading no. 13, the action is based on the contract of carriage up to the final port of destination, which was Cebu City, for which the corresponding freight had been prepaid. - The transshipment of the cargo from Manila to Cebu was not a separate transaction from that originally entered into by Macondray, as general agent for the "M/S TOREADOR". It was part of Macondray's obligation under the contract of carriage and the fact that the transshipment was made via an inter-island vessel did not operate to remove the transaction from the operation of the Carriage of Goods by Sea Act.

Rizal Surety vs. Macondray 22 SCRA 902FACTS: Rizal Surety seeks to recover from Macondray as authorized agent of Barber Steamship Line Inc. in Manila, which operates the vessel SS Tai Ping, the sum of P2,000.00 representing the maximum value recoverable under the corresponding bill of lading. The machinery parts boarded on the SS Tai Ping was not discharged in Manila, in view of which the plaintiff had to pay, pursuant to its contract of insurance with the consignee. Macondray set up the defense of prescription which the lower court sustained. CFI dismissed the complaint. ISSUES: Whether the period of prescription in the foregoing provision is controllingRULING: Yes. As the SS Tai Ping arrived at the Port of Manila on November 2, 1962 and left it on November 4, 1962, it was on the latter date that the carrier had the last opportunity to deliver the goods; that the period of one year within which the carrier could be sued commenced to run, therefore, from November 5, 1962 and expired on November 4, 1963; and that said period has expired before this action was commenced on February 10, 1964.* Rizal Surety maintains: the theory that the Section 3 par. 6, Title I, of the Carriage of Goods by Sea Act cannot apply when the shipment in question has not been discharged from the carrying vessel, as in the case at bar. - Sec. 3, par. 6 anticipates two (2) other possibilities, 1) that delivery has been made, in which case the action should be brought within one year after delivery of the goods; or 2) that no delivery has taken place, in which event said period should be computed from the date when the goods should have been delivered. - In the latter contingency, the cause of such non-delivery that is to say, whether the goods have been discharged from the vessel or not is immaterial. If the goods have not been discharged from the vessel, the non-delivery is imputable to the carrier. So would it be, if the goods had been unloaded from the vessel, but not delivered to the consignee. Indeed, in such case of discharge of the goods from the vessel, the carrier would still be liable for non-delivery of the goods, because the same would be due to its own omission, if it undertook to make the delivery by itself, or to the omission of its agent, if the carrier entrusted the custody of the goods and/or its delivery to a third party.*Rizal Surety claims: the general statute of limitations of action should apply.-The statute of limitations of action cannot be applied to the present case because the corresponding bill of lading which is the contract and, hence, the law between the parties.

Union Carbide Phils vs. Manila Railroad 77 SCRA 359FACTS: On December 18, 1961, the vesselDaishinMaruarrived in Manila with a cargo of 1,000 bags of synthetic resin. On Dec. 19, the cargo was delivered to the Manila Port Service in good order and condition except for 25 bags which were in bad order. Only 898 bags of resin were delivered by the customs broker. 102 bags were missing. The contents of 25 bags were damaged or pilfered while they were in the custody of the arrastre operator. Union Carbide filed on January 3, 1962 with the Manila Port Service, as arrastre operator, and the American Steamship Agencies, Inc., as agent of the carrier, a provisional claim advising them that the shipment was short delivered and/or landed in bad order". Union Carbide filed a complaint on December 21, 1962 in the CFI against the Manila Railroad Company, the Manila Port and the American Steamship for the recovery of damages amounting to P7,402.78. Union Carbide's complaint was a double-barrelled action or a jointer of two causes of action. One was an action in admiralty under the Carriage of Goods by Sea Act against the American Steamship for the recovery of P1,217.56 as the value of 25 bags. The other was an action under the management contract between the Bureau of Customs and the Manila Port, a subsidiary of the Manila Railroad, for the recovery of P6,185.22 as the value of the undelivered 102 bags of resin and 25 bags. The trial court dismissed the case as to the American Steamship on the ground that the action had already prescribed. The trial court found that the provisional claim was filed within the fifteen-day period. Yet, the trial court dismissed the action against the arrastre operator. ISSUES: 1) Whether or not the claim against the American Steamship had already prescribed 2) Whether or not the claim against the Arrastre Operator had already prescribed RULING:1) Yes. From December 19, 1961, the cargo was discharged from the carrying vessel and delivered to the Manila Port Service. That one-year period expired on December 19, 1962. Inasmuch as the action was filed on December 21, 1962, it was barred by the statute of limitations.*Union Carbide contends: that "delivery" does not mean the discharge of goods or the delivery thereof to the arrastre operator but theactual delivery of the goods to the consignee by the customs broker.*American Steamship contends: thatdelivery means discharge from the vessel into the custody of the customs arrastre operatorbecause under sections 1201 and 1206 of the Tariff and Customs Code merchandise cannot be directly delivered by the carrier to the consignee but should first pass through the customhouse at a port of entry for the collection of customs duties.- Delivery within the meaning of section 3(6) of the Carriage of Goods by Sea Law meansdelivery to the arrastre operator.That delivery is evidenced by tally sheets which show whether the goods were landed in good order or in bad order, a fact which the consignee or shipper can easily ascertain through the customs broker.-To use as basis for computing the one-year period the delivery to the consignee would be unrealistic and might generate confusion between the loss or damage sustained by the goods while in the carrier's custody and the loss or damage caused to the goods while in the arrastre operator's possession.2) No. The management contract between BOC and Manila Port provides that the action against the arrastre operator to enforce liability for loss of the cargo or damage should be filed within one year from the date of the discharge of the goods or from the date when the claim for the value of such goods has been rejected or denied by the arrastre operator.However, before such action can be filed a condition precedent should be complied with and that is, that a claim (provisional or final) shall have been previously filed with the arrastre operator within fifteen days from the date of the discharge of the last package from the carrying vessel. Having complied with the condition precedent for the filing of a claim within the fifteen- day period, Union Carbide could file to the court action within one year, either from December 19, 1961 or fromDecember 19, 1962. This second date is regarded as the expiration of the period within which the Manila Port should have acted on the claim. The claimant or consignee has atwo-year prescriptive period,counted from the date of the discharge of the goods, within which to file the action in the event that the arrastre contractor, as in this case, has not rejected nor admitted liability Since the action in this case against the arrastre operator was filed on December 21, 1962, or within the two-year period expiring on December 19, 1963, that action was filed on time.

Ang vs American Steamship Agencies 19 SCRA 123FACTS: Yau Yue Company agreed to sell 140 packages of galvanized steel durzinc sheets to one Herminio G. Teves. Said agreement was subject to the following terms and arrangements: (a) The purchase price should be covered by a bank draft for the corresponding amount which should be paid Teves in exchange for the delivery to him of the corresponding bill of lading; b) Upon arrival of the articles in Manila, Teves would be notified and he would have to pay the amount, after which the bill of lading would be delivered to him; and (c) Teves would present said bill of lading to the carrier's agent, American Steamship Agencies, Inc. which would then issue the corresponding "Permit To Deliver Imported Articles" to be presented to the Bureau of Customs to obtain the release of the articles. Yau Yue shipped the articles aboard the S.S. TENSAI MARU of which the American Steamship Agencies, Inc. is the agent in the Philippines consigned with Herminio G. Teves. When the articles arrived in Manila on or about May 9, 1961 Teves was notified of the arrival of the goods and requested payment of the articles. Teves, however, did not pay the demand draft. The bill of lading and demand draft to Yau Yue which indorsed the said bill of lading to Domingo Ang. Despite of Teves non-payment of the of the articles, Teves was able to obtain a bank guaranty in favor of the American Steamship to the effect that he would surrender the original and negotiable bill of lading duly indorsed by Yau Yue. Teves succeeded in securing a "Permit To Deliver Imported Articles" from the American Steamship, which he presented to the BOC which in turn released to him the articles covered by the bill of lading. Domingo Ang claimed for the articles from American Steamship by presenting the indorsed bill of lading, but he was informed by the latter that it had delivered the articles to Teves. On October 30, 1963, Ang filed a complaint in the CFI against the American Steamship for having allegedly wrongfully delivered and/or converted the goods covered by the bill of lading belonging to Ang. American Steamship filed a motion to dismiss upon the ground that plaintiff's cause of action has prescribed under the Carriage of Goods by Sea Act more particularly Section 3 (6), paragraph 4 CFI dismissed the action on the ground of prescription.ISSUES: 1) Whether or not there was "loss" of the goods subject matter of the complaint.2) Has plaintiff-appellant's cause of action prescribed under Section 3(6), paragraph 4 of the Carriage of Goods by Sea Act?RULING: 1) No. The goods cannot be deemed "lost". They were delivered to Herminio G. Teves, so that there can only be either delivery, if Teves really was entitled to receive them, or misdelivery, if he was not so entitled.As defined in the Civil Code and as applied to Section 3 (6) par. 4 of the Carriage of Goods by Sea Act, "loss" contemplates merely a situation where no delivery at all was made by the shipper of the goods because the same had perished, gone out of commerce, or disappeared that their existence is unknown or they cannot be recovered. It does not include a situation where there was indeed delivery but delivery to the wrong person, or a misdelivery, as alleged in the complaint in this case.

2) No. There being no loss or damage to the goods, the one year prescription does not apply. Said one-year period of limitation is designed to meet the exigencies of maritime hazards. Suits predicated not upon loss or damage but on alleged misdelivery (or conversion) of the goods, the applicable rule on prescription is that found in the Civil Code, namely, either 10 years for breach of a written contract or 4 years for quasi-delict. (Arts. 1144[1], 1146, Civil Code) In either case, Angs cause of action has not yet prescribed, since his right of action would have accrued at the earliest on May 9, 1961 when the ship arrived in Manila and he filed suit on October 30, 1963.

Elser vs. CA L-6517, Nov. 29, 1954FACTS: On Dec. 1945, the goods specified in the Bill of Lading were shipped on the 'S.S. Sea Hydra,' of Isthmian Steamship Company, from New York to Manila, and were received by the consignee 'Udharam Bazar and Co.', except one case of vanishing cream valued at P159.78. The goods were insured against damage or loss by the 'Atlantic Mutual Insurance Co.' 'Udaharam Bazar and Co.' claimed for indemnity of the loss from Atlantic Mutual and was paid by its agent 'E. E. Elser Inc. The Court of Appeals held that petitioners have already lost their right to press their claim against respondent because of their failure to serve notice thereof upon the carrier within 30 days after receipt of the notice of loss or damage as required by clause 18 of the bill of lading which was issued concerning the shipment of the merchandise which had allegedly disappeared.

ISSUES:1) Which provision should prevail? Is it that contained in clause 18 of the bill of lading or the Carriage of goods by sea act?2) Whether or not the period had prescribedRULING:1) Clause 18 must of necessity yields to the provisions of the Carriage of Goods by Sea Act which says: "any clause, covenant, or agreement in a contract of carriage relieving the carrier or the ship from liability for loss or damage to or in connection with the goods . . . or lessening such liability otherwise than as provided in this Act, shall be null and void and of no effect." (section 3.) This means that a carrier cannot limit its liability in a manner contrary to what is provided for in said act. Clause 18 of the bill of lading must of necessity be null and void.*Isthmian Steamship contends: that the Philippines was still a territory or possession of the United States and it may be said that the trade then between the Phils. and the US was not a "foreign trade. Therefore, Sea Act does not apply to the shipment. - we are of the opinion that the Carriage of Goods by Sea Act of 1936 may have application to the present case it appearing that the parties have expressly agreed to make and incorporate the provisions of said Act as integral part of their contract of carriage. This is an exception to the rule regarding the applicability of said Act. This is expressly recognized by section 13 of said Act. 2) Action of Elser has not yet lapsed or prescribed it appearing that the present action was brought within one year after the delivery of the shipment. According to Sea Act, a carrier can only be discharged from liability in respect of loss or damage if the suit is not brought within one year after the delivery of the goods or the date when the goods should have been delivered, and that, even if a notice of loss or damage is not given as required, "that fact shall not affect or prejudice the right of the shipper to bring suit within one year after the delivery of the goods." In other words, regardless of whether the notice of loss or damage has been given, the shipper can still bring an action to recover said loss or damage within one year after the delivery of the goods.

Insurance Co. Vs. Phil. Ports Terminal L- 6420 July 18 1955FACTS: The Insurance Company of North America filed a complaint against the Philippine Ports Terminals, Inc., alleging that the Philippine Ports Terminals, Inc., was the contractor and operator of the arrastre service in the Port of Manila and was charged with the custody and care of all cargoes discharged at the government piers at Manila with the duty to deliver same to their respective owners upon presentation by the latter of release papers from the agents or owners of vessels and the Bureau of Custom; On September, 1949, the steamship "PRESIDENT VAN BUREN" discharged into the custody of the Philippine Ports one case of machine knives consigned to the Central Saw Mill, valued at least P3,796.00 but said merchandise was never delivered by Phil. Ports to Central Saw. Phil. Ports admits the non-delivery of the said merchandise to the Central Saw and offered to pay P500.00 for said merchandise instead of its value P3,796.00 which offer was refused; Insurance Company was subrogated to the rights of the Central Saw and that the Phil. Ports refused to pay said sum of P3,796.00. The Phil Ports filed a motion for dismissal on the ground that the complaint was filed after one year from the time that the cause of action accrued. CFI dismissed the complaint.ISSUES: Whether or not the cause of action had prescribedRULING: No. The action in this case has been brought within that time. Philippine Ports is neither a charterer nor a ship. Section 1 (a) and (d) of "Carriage of Goods by Sea Act" defines the terms "carrier" and "ship" as follows:The term "carrier" includes the owner or the charterer who enters into a contract of carriage with a shipper.The term "ship" means any vessel used for the carriage of goods by sea. Consequently, the "Carriage of Goods by Sea Act" does not apply to it. The ordinary period of four years fixed by the Code of Civil Procedure will apply.